Long-Term, Sustainable Investments
Building tomorrow's portfolio
Long-Term, Sustainable Investments
Building tomorrow's portfolio
CaBo Capital is an investment office focusing on control investments in cash-flow positive middle market players (approx. $40-120M in revenues) in selected sectors. CaBo Capital has a longer investment and hold-horizon than the typical private equity fund.
What we do
Thesis driven investments
Focused portfolio consisting of thesis driven investments with identified value creation: invest in a small number of businesses in attractive market segments where CaBo Capital can facilitate consolidation and become a value-added business partner to the acquired companies and utilize significant resources to support their development and growth.
Longer term investment horizon
CaBo Capital’s investment plan is flexible and does not require an exit after four to five years but rather allows for the extension of the investment horizon and holding period, if needed to ensure the delivery of significant return on investment over the business cycle.
Value buyer
CaBo Capital only invests in businesses for which the value creation plan projects faster growth than the market and a significant increase in profits. Although the market has become a high-multiple environment, the value creation plan determines the valuation of CaBo Capital’s investments.
Recession resilient themed investments
CaBo Capital seeks to avoid companies which are consumer-facing, are in cyclical or commodity sectors, face material exposure to technology risk, or are exposed to regulatory shifts. CaBo Capital pursues investments characterized by stable demand and supply dynamics, limited customer and vendor concentration and critical value to supply chains but at a low cost relative to the final value of the underlying good or service.
How we do it
We research and identify attractive market segments where we can facilitate consolidation and where we can become a value-added partner to the acquired companies. After identifying high-value targets in the segments, our thorough due diligence process includes management assessments, market position evaluation and top and bottom-line improvement analysis and planning. We understand the importance of consulting extensively with senior managers, operations executives, sales and marketing teams, as well as customers, suppliers and other industry experts to fully understand the opportunities and risks of the businesses we enter.
We help improve the growth and profitability profile of acquired businesses through our Full Potential Approach. Our program includes the implementation of the right strategy, strong emphasis on execution in operational excellence, organizational alignment, and the right financing. It is complemented with a portfolio optimization which may include divestitures or select follow-on acquisitions to strengthen the customer base, offering portfolio or regional/segmental market share.
During this process we leverage our expertise and network of relationships in emerging growth markets as well. We are intimately familiar with the challenges and opportunities in developing regions and are committed to sustainable development. This strategy allows us to build segment leaders with strong and defensible market positions and profitability. With sustainable leadership, the companies achieve above average top-line and earnings growth, as well as evolve into a premium brand, delivering a higher valuation for the business.
We believe that only great management teams will drive exceptional business performance. As a result, we invest in building a long-term partnership with the management teams of the companies we acquire. We typically offer equity or options for the management teams and encourage them to invest alongside CaBo Capital in the deals. We then work together as financial and strategic partners to enhance the value of the business.
Who we are
The results
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Key investment principles and criteria
Focused portfolio consisting of thesis driven investments with identified value creation: invest in a small number of businesses in attractive market segments where CaBo Capital can facilitate consolidation and become a value-added business partner to the acquired companies and utilize significant resources to support their development and growth.
Longer term investment horizon: CaBo Capital’s investment plan is flexible and does not require an exit after 4-5 years but rather allows to hold-on for longer horizons, if needed to ensure the delivery of significant return on investment over the business cycle.
Value buyer: CaBo Capital only invests in businesses for which the value creation plan projects faster growth than the market and a significant increase in profits. Although the market has become a high-multiple environment, the value creation plan determines the valuation of CaBo Capital’s investments.
Recession resilient themed investments: CaBo Capital seeks to avoid companies which are consumer-facing, are in cyclical or commodity sectors, face material exposure to technology risk, or are exposed to regulatory shifts. CaBo Capital pursues investments characterized by stable demand and supply dynamics, limited customer and vendor concentration and critical value to supply chains but at a low cost relative to the final value of the underlying good or service.
Target ranges:
(While these ranges are directionally ideal,
we are flexible on the ranges for the right deal)
Turnover: $40-120M
Cash Flow: positive, path to double digit margins
Ideal Enterprise Value: up to ~$50-80M
Target sectors (with low cyclicality, high barriers to entry, good growth and profitability prospects, opportunity for differentiation, potential for consolidation):
Highly engineered, mission critical components and products serving highly regulated businesses (e.g. industrial automation, aerospace, testing & measurement, renewable energy or clean technologies, laboratory and diagnostic tools, med-tech)
Services with secular long term growth drivers (e.g. real estate, aerospace and defence MRO, health and social care, laboratory, diagnostic and therapies)
Target regions
Platform investments: The US, DACH Region, Nordics and the UK
Synergistic add-ons: Anywhere
Transaction types:
Corporate Carve-outs
Buyouts (MBO, MBI)
Company characteristics:
Leading market share and brand awareness
Long term customer base
History of navigating economic downturns
Low-cost operations relative to peers
How to reach us
CaBo Capital LLC
149 South Barrington Avenue, #815, Los Angeles, California 90049, United States
For Private Equity, Private Debt, Real Estate and Advisory Inquiries - info@cabocap.com
CaBo Capital LLC - Long-Term, Sustainable Investments