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| Following broad objectives have been taken into account while coming up with the model for investment decisions: |
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We want to have members who are involved in the Network strategy, operations, and actually invest through it. However, some members may spend disproportionate time on not only deal progression and closure but also in adding value to the business going forward. Members are encouraged to suitably incentives and reward such initiatives and efforts.
People with differential ability to invest must be accommodated, especially as we will induct diverse people into the group. Also, adding members will be a continuous activity and not one time (such as fund closure). Both these require a flexible model in terms of where and how much each member invests. This will also ensure that new members feel invited to the Network with minimal constraints.
- Investee companies will be explained the Network’s framework for investing and mentoring, as explained in this document, and a concurrence sought early in the discussions.
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| Given these objectives, it is proposed that the Network investment decisions be made in following fashion: |
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Network meetings will be convened every 4 or 8 weeks, depending on the dealflow, to discuss deals that have been either directly sponsored by members or recommended by the “elevator pitch” (“EP”) committee members. All members present will then discuss and debate each investment and any concerns they might have, any additional information required, etc. Each subgroup will nominate a member (the “lead member”), who will lead all discussions on deal valuation, structure and closure with the entrepreneur. For the entrepreneur, the lead member will be the single point of contact for such discussions. Each Network member will be free to make his or her individual decision on investing in any given opportunity. - As a broad outline, it is expected that members will invest in the region of Rs 25 lakhs per annum. It is also expected that members who do not invest at all for two years would be deemed not to have received value and must therefore review whether they should at all continue their membership.
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