Overview History Investment Criteria Business Plans

VELOCITY EQUITY PARTNERS, LLC

Overview

Velocity Equity Partners is a private venture capital firm investing in early stage growth companies primarily in the Northeast. Velocity’s mission is to create value by identifying and supporting outstanding entrepreneurs with unique innovations and a powerful drive to build market-leading companies. Velocity’s partners work with management teams to create premier companies in their field with the help of capital, expertise in building companies, and access to key networks.

 

History

Velocity Equity Partners was founded with the merger of two independent venture investment groups: Velocity Capital and Corning Technology Ventures (a.k.a. Corning Capital Ventures). The merger brings together two experienced teams with over 40 years of combined experience in early stage venture investing.

Investment Criteria

Sector Focus

Velocity seeks investment opportunities in primarily the following sectors:

  • Information Technology, including:
    • Enterprise Software and Infrastructure
    • Communications Infrastructure
    • Wireless Applications
    • Niche Vertical Software Applications
  • Manufacturing Technologies, including:
    • Silicon and hardware based technologies
    • Sensors and process controls
    • Applications of technologies to manufacturing processes and industrial products

While Velocity participates in venture financings of all sizes and stages, the firm's specialty is investing in opportunities in the "Capital Gap." In general, this includes companies seeking to raise between $1 million and $5 million. Velocity frequently seeks to become involved with a business in the earlier stages where the current capital need is less than the $10M+ average deal size of larger venture firms. Velocity believes that the best opportunities for Velocity and for the entrepreneur as well as management are those that can get to exit on less than $10-15M of total capital investment.

Defensible Advantages

Velocity seeks business opportunities with proprietary defensible advantages, including intellectual property.

Business Criteria

Realistic Growth and Obtainable Profitability

An important part of Velocity's investment analysis includes assessing the management team's ability to achieve their projected sales and earnings targets. Velocity invests in companies with obtainable plans for revenue growth and credible plans for achieving profitability. Companies that meet projected revenue targets and obtain profitability will have more exit options available to them.

Financial Criteria - Revenues and Capitalization

Velocity considers the following to be important financial criteria that must be demonstrated before Velocity considers an investment in a potential portfolio company:

  • The company must have the potential to achieve annual revenues of $30 million within 5 years and show at least 100% year-to-year revenue growth for at least the first three years.
  • While Velocity occasionally invests in company's that have not yet begun recognizing revenue, companies should generally either be recognizing revenue or be on the verge of recognizing revenue(via an imminent product introduction, etc.). Velocity considers technology that can be validated and prefers opportunities where customers and/or prospects can be identified and contacted as part of the due diligence process.
Management Must be Flexible, Experienced and Strategically Oriented

The management team should have relevant experience, a track record of accomplishment, and be willing to work with Velocity to maximize the success of the company. Particular qualifications and skills Velocity looks for in a management team include:

  • The team must show the ability to act on and react to market input and when necessary proactively diverge from the original business plan and quickly develop new plans as the marketplace and assumptions change.
  • The Management Team must be looking for a strategic relationship with its investors. Velocity intends to add value through means other than just capital, and thus, is not interested in financing companies that are seeking only money from its investors.

Geography

Velocity invests primarily in the New England, New York and Washington D.C. corridor.

Business Plans

Click here to learn more about submitting business plans to Velocity.


Copyright 2003-2006 Velocity Equity Partners, LLC

Back