While many day traders get excited about the fluctuations of the stock market, the unexpected rises and quick falls, a solid investment strategy, especially when purchasing a business, considers the long-term impacts of an investment. When the HRH team considers investing in a new business, we look at a number of factors.
A $5 million EBITDA is a target we often consider, looking at businesses that have started operations successfully and are poised to grow. Our expertise is taking smaller companies in good markets and leveraging our team and expertise to grow those businesses. Often, we look at complementary businesses that provide services for our current portfolio of companies. Then we can look at the market, the future growth of a particular industry, and even the technology we think is likely to develop in the future.
Buying with an eye towards long-term returns means making solid decisions based on data, not emotions. While all businesses are impacted by the economy, a solid investment that you intend to build over the long term is going to be purchased and retained based on numbers. With the right metrics, you can be confident that your business is growing and thriving and producing a return on your investment.
While the different businesses that are part of the HRH Capital portfolio represent a range of industries, sizes, products or services, and even technology, they were all purchased with the same investment strategy in mind. We continue to look for businesses that will strengthen our portfolio and that we believe, based on their past success, will continue to be viable and growing opportunities into the future.