Strategic Investments

Executive summary

Strategic Investments

A Strategic Investment process helps clients to define their investment objectives and then design a customized portfolio strategy in order to achieve them. Implementing a strategic investment process can help overstretched and under-resourced firms fulfil their wide-ranging and complex responsibilities. The key is to partner with a consultant who is dedicated to helping design and implement investment policies that are tailored to your particular objectives, mission, willingness to bear risk, and changing circumstances. The ideal strategic relationship should be a seamless extension of your own human resources, complementing them with the additional resources needed to steward investments effectively, by using a stakeholder management process. This will enable you to: improve your return on investment; optimize governance and reduce costs. The ultimate aim is to achieve your projected return on investment, at the least possible cost and with the minimum amount of risk. This service will help you to construct a cost-efficient portfolio that strives to strike an optimal balance between risk and return, and it can employ sophisticated analytical tools to properly align an investment strategy with an institution’s circumstances and core mission. Improving net-of-fee, risk-adjusted returns increases wealth over time and helps institutions satisfy the growing demands placed upon their investment portfolios. The service increases the efficiency and agility of decision-making, simplifies oversight, and helps appropriately focus the attention of each level of investment governance. By taking on the responsibility of the day-to-day management of the investment portfolio, the service allows internal staff to focus on core operations, and governing bodies to focus on setting the institution’s strategic direction and ensuring the alignment of the investment policy with that direction. Governance is also enhanced by replacing the fragmented views provided under the traditional fiduciary governance model with the total perspective provided to fiduciaries by the consultant. Implementing the Strategic Investments service eliminates the need to recruit and retain a fully staffed internal investment office and to provide that office with the up-to-date systems required for policy design, risk management, back-office operations, and performance measurement. It also saves money for its clients by making its portfolio management process more efficient. These efficiencies include the ability to negotiate lower manager fees, eliminate fund-of-fund fees, and minimize costs associated with third-party providers, many of whom are rendered superfluous by this service.

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Service Methodology

The Strategic Investment service provides tangible business processes that enable institutions to: undertake market research and analysis; establish a clear understanding of the competitive landscape; use a strategic fit criteria to identify suitable targets; improve their financial modelling; improve their due diligence; undertake realistic valuations; improve deal management, including legal, accounting and tax; improve negotiations procedures; integrate a 100 day plan, incorporating execution and implementation; improve investor relations through stakeholder management; professionalize board presentations, communications and documentation; improve financial planning and analysis and to develop and implement business growth and cost reduction projects.

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Service Options

Companies can elect whether they just require Appleton Greene for advice and support with the Bronze Client Service, for research and performance analysis with the Silver Client Service, for facilitating departmental workshops with the Gold Client Service, or for complete process planning, development, implementation, management and review, with the Platinum Client Service. Ultimately, there is a service to suit every situation and every budget and clients can elect to either upgrade or downgrade from one service to another as and when required, providing complete flexibility in order to ensure that the right level of support is available over a sustainable period of time, enabling the organization to compensate for any prescriptive or emergent changes relating to: Customer Service; E-business; Finance; Globalization; Human Resources; Information Technology; Legal; Management; Marketing; or Production.

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Service Mission

An institutional investment portfolio exists to serve a broader mission. The Strategic Investments service provides the business processes and analytical tools needed to quantify the impact of a range of potential investment outcomes on the institutions financial well-being and ability to achieve its strategic objectives. With these tools, the (SI) service can rigorously assess the alignment of different investment strategies with a client’s mission.

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Further Information

The central focus of Mr. Gurevich’s career has been internal and external consultancy, delivering expertise in strategic planning, corporate finance, fundraising/investor relations, and M&A. Serving 4 years as Vice President of Strategy and Operations at a private equity firm focused on the education management sector, with accountability for leading M&A strategy, dealflow, due diligence, valuations, divestitures, deal sourcing, integrations, and identifying/executing growth initiatives with senior management teams as internal strategic management consultant. He has developed and established a comprehensive strategic scorecard, which has been used to identify and evaluate over $2B in investment opportunities, enabling acquisitive growth strategy to expand core operating platform and adjacent portfolio companies from $1.7B to $6B in five years. He has accumulated knowledge and expertise in strategy, finance, and operations as well as the network of relationships in PE sector allowed him to share and apply those skills in a variety of advisory and consulting engagements over the last 7 years, focusing heavily on Healthcare, Technology and Education Management. He has gained strong exposure to issues faced by Healthcare investors and operators enabling him to become tactically and strategically instrumental to the success of several ventures in that space, including offerings focused on technologies for evidence-based medicine, enterprise-scale EMR deployments, disruptive provider security solutions, as well as financing of intellectual property portfolios. He has had hands-on involvement in the management of numerous investments, that have been synergistic with his activities as Investment Banking Adviser, assisting those who are looking to fund their first venture as well as large institutional investors in need of sophisticated financial engineering, aligned corporate strategy, and risk management.

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Service objectives

The following list represents the Key Service Objectives (KSO) for the Appleton Greene Strategic Investment service.

1. Planning
   The client-centric process focuses on designing an optimal long-term strategy that is customized to each client’s unique objectives, risk appetite, and mission. We collaborate with our client to set an investment policy that defines financial objectives and risk parameters and provides the framework including: asset allocation guidelines; benchmarks; and risk control ranges, for achieving those goals.
2. Development
   Once the investment policy is set, the (SI) service develops the active portfolio structure relative to that policy. Our tactical asset allocation decisions integrate proprietary and third party insights to assess the relative attractiveness of asset classes. Using these insights, we actively manage asset allocations in light of changing economic conditions and relative valuations. Our structuring tilts within asset classes seek to exploit valuation anomalies across different market segments. We use proprietary analytical tools to disentangle the underlying factor exposures of each asset class, assess their relative valuations, and actively manage the exposure to each factor.
3. Implementation
   We are process improvement specialists. We strive to construct optimal portfolios of diversified market and active exposures. Our analytics processes and stakeholder management approach brings experienced insight to structuring portfolios and selecting and monitoring what we believe to be top-tier management processes. We use active managers within your organization to seek alpha and help achieve the targeted portfolio structure. Our direct trading capacity complements active managers and enhances liquidity, lowers costs, and increases agility.
4. Management
   Our comprehensive, risk management processes evaluates and seeks to calibrate the macro-level risks that arise from asset allocation and structuring decisions as well as the security-specific risks produced by the active management activities of specialist investment managers. These sophisticated analytics disentangle the underlying risk factors embedded in a portfolio. The analytics allow us to manage the exposure to each risk factor as a means of managing absolute and relative risk.
5. Review
   The (SI) service uses established processes to review the performance of the planning, development, implementation and management procedures in order to optimize performance and to contribute towards continuous improvement. We also use a balanced scorecard to strategically monitor the performance of each individual investment portfolio and compare each portfolio’s performance with market trends. This enables us to improve and evolve your Strategic Investment processes over a sustainable period of time, thus improving your return on investment and reducing risk.

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Testimonials

N. Chandler (Private Client)

“Mr. Gurevich provided some valuable incites. I started a skeptic, given the nature of hiring someone for Merger & Acquisition and Venture Capital advice on a freelancing basis and left amazed. The mark of expertise and a true professional in my opinion is a willingness to poke holes in your story. He pushed back when necessary, offered valuable advice in charting a path and helped me revise the first draft of this chapter in my business. I can recommend his services to anyone and will return for consultations in the future.”

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Doctor Evidence LLC

“It was a pleasure to work with Mr. Gurevich when we collaborated on a global Knowledge Management initiative. Besides having a very sound technical understanding of the issues at hand, he clearly demonstrated his ability to keep the “bigger picture” constantly in the project context. This ability to balance the strategic with the tactical is key to the long term success of transformational initiatives in any organization. I would highly recommend him to a senior management position in any organization.”

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Teachscape Inc

“Mr. Gurevich and I worked closely together at Teachscape. His skills and insights were invaluable in building the operating and strategic plans. He was exceptional at producing high quality work on a short timeline. It would be a pleasure to work with him again.”

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Knowledge Universe Education

“Mr. Gurevich has demonstrated exceptional strategic management skills. He has a rare ability to balance the long-term vision perspective and execution discipline. It was a pleasure working with him and I highly recommend him as a skilled transformational leader.”

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Knowledge Universe Education

“While Mr. Gurevich was working at KUE as a VP of strategy, planning, and operations we worked on a few analytical projects together. I can assure everyone that he is a solid clear thinker who can add value to any enterprise. I strongly endorse his analytical and critical thinking skills.”

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More detailed achievements, references and testimonials are confidentially available to clients upon request.

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Industries

This service is primarily available to the following industry sectors:

Education

The educational services market is large and growing with several types of opportunities available for franchisees. There are approximately 58,113 establishments in the industry which earn a combined $19.4 billion dollars in revenue. The industry is largely fragmented, the fifty largest companies represent just 30% of the total revenue in the industry. There ere 55.1 million students attending school in grades K-12, all of whom are potential clients for educational services – and that number is expected to increase to 74 million. The vast majority of revenue in this industry comes from tuition or program fees. Gross profits tend to range from 60-90% depending on the location and particular course, and net profit averages out to between 2-10%. Increasing company size has helped consolidate operations in the educational services field – helping to lower fixed costs and improve overall operational efficiency, both of which are very important to keeping businesses in the field healthy and profitable. Finding qualified instructors in any field is becoming increasingly challenging; it is important to inquire about this when researching potential companies. There is a potential danger to some areas of the field in future competition from online training courses, which are growing more and more popular as technology spreads. In addition, businesses face competition from free online resources and computer software. Overall, however, the field is expanding, educational services in the United States are forecast to grow by 5% per year over the next five years.

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Healthcare

The health care industry, or medical industry, is an aggregation of sectors within the economic system that provides goods and services to treat patients with curative, preventive, rehabilitative, and palliative care. The modern health care industry is divided into many sectors and depends on interdisciplinary teams of trained professionals and paraprofessionals to meet health needs of individuals and populations. The health care industry is one of the world’s largest and fastest-growing industries. Consuming over 10 percent of gross domestic product (GDP) of most developed nations, health care can form an enormous part of a country’s economy. For purpose of finance and management, the health care industry is typically divided into several areas. As a basic framework for defining the sector, the United Nations International Standard Industrial Classification (ISIC) categorizes the health care industry as generally consisting of: hospital activities; medical and dental practice activities; “other human health activities”. This third class involves activities of, or under the supervision of, nurses, midwives, physiotherapists, scientific or diagnostic laboratories, pathology clinics, residential health facilities, or other allied health professions, e.g. in the field of optometry, hydrotherapy, medical massage, yoga therapy, music therapy, occupational therapy, speech therapy, chiropody, homeopathy, chiropractics, acupuncture, etc. The Global Industry Classification Standard and the Industry Classification Benchmark further distinguish the industry as two main groups: health care equipment and services; and pharmaceuticals, biotechnology and related life sciences. Health care equipment and services comprise companies and entities that provide medical equipment, medical supplies, and health care ser