The cohort will get help refining their investment pitches as well as access to the group's network of institutional investors.
Three companies building artificial intelligence products and services have a fast track to funding as the newest members of the ELITE Group. This private business development program developed by the London Stock Exchange and Global Accelerated Ventures provides entrepreneurs with business coaching and access to institutional investors.
ELITE announced Friday three new companies that will be in the organization's latest cohort:
- ModuleQ: An artificial intelligence (AI) platform that analyzes data from calendars, email, and Microsoft Teams to make business recommendations for individuals.
- Covex 2020: An AI company that combines and analyzes multiple data sets to support decision making.
- vElement: A service provider that specializes in robotic process automation, data science, and artificial intelligence.
Thomas Tyler, global head of ELITE Americas and global head of business development, said that companies in the new cohort first will refine their core strategy and their pitch to investors. The next step is connecting the companies with ELITE's network of institutional investors.
"The goal is to get bigger, get bought, or get listed," he said.
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ELITE has worked with companies in 45 countries and in all sectors that share a common factor of an ambition to grow and the willingness to learn. The focus for this cohort was fintech and healthtech. Companies applied for a spot and had to meet these criteria:
- Turnover greater than $5 million
- Operating earnings greater than 5% of turnover
- Positive net profit
- Demonstrate historic growth and future potential
- Convincing projections
- Motivation to deal with the cultural, organizational, managerial change required to access long-term financing opportunities
Tyler said the ELITE program fills a gap for businesses that are beyond the accelerator phase and just starting to scale and grow.
ELITE works with more than 200 partners including lawyers, brokers, and sales and marketing experts to support cohort companies.
Tyler said that even in this climate of uncertainty there are opportunities to engage with investors, although entrepreneurs might have to accept slightly lower valuations.
"Clearly COVID is going to change some portfolio strategies but our view is that the fundamentals of that process don't change," he said.
Companies that are invited to join the organization can work with the coaches and use the funding network for as long as they need to. Tyler said members have been contacting ELITE for advice more frequently since the pandemic started.
"COVID has highlighted where they were weaker than they thought and emphasized the need to have the right people on board and the right processes in place," he said.
Polishing the investment pitch
Tyler offered this advice for entrepreneurs looking for support from investors:
- Know how to tell your story
- Know your numbers
- Explain your governance processes
- Be able to explain clearly what your ambition is
He said one common challenge for entrepreneurs is recognizing the moment when it's time to stop working on day-to-day operations and start working on the strategic plan. Having a comprehensive plan helps companies stand out to investors who hear hundreds of pitches a year.
"A company that is unprepared may not necessarily have a tested investment story or a growth story that will withstand the scrutiny of an investment market," he said.
Tyler said that ELITE helps companies refine their corporate governance and risk management plans because investors are looking for resilient business models.
"Investors want to understand that there are good processes in place to protect the investment," he said. "Companies need a solid five-year strategic growth plan which can sometimes supersede whatever the business opportunity might be."
"The process of building a business is one of constant learning and engagement and you have to have that mindset as you move through those processes," he said.
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