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#1 Research, research and research...
Spend time researching sectors and sub-sectors, understanding market dynamics, competitive landscape, profitability at a granular level. As an example, if you are looking to invest into healthcare, which sub-sectors are insulated from the crisis? Are these sectors earning attractive ROC for investors? What will change in the future?
# 2 Identify potential target companies in chosen sub-sector
In the chosen sub-sector, what are some of the actionable target companies? Which of these meet your investment criteria? Do these companies have a strategic advantage? Doing preliminary "outside-in" research, talking to customers/suppliers gives a good grasp on the position/real attractiveness of these companies & management.
# 3 Open channels of communication with target companies...NOW!
While it is unlikely that a deal gets done in coming weeks, it is important to have a credible channel of communication with your potential targets. Demonstrating that you understand the sector, their challenges and can bring expertise beyond capital, is attractive to any CEO/business owner living through this crisis. If anything, this crisis has reminded many small-medium owners that the world can change overnight and having a partner with ability to deploy capital at short notice is an asset.
Over the last few weeks, we at Medi-Tech Insights, have worked with investors to deploy these strategies in the healthcare sector. Are you ready with a clear action plan when the fog clears out?
