Investment strategy

We are the 4th industrial revolution investment company

Investing in & scaling European manufacturing champions

Oak Universe invest in high potential companies in the advanced manufacturing sector that has the ability to increase their value significantly by a 4th Industrial Revolution transformation. Oak Universe will support the companies in the value creation process to enhance their equity value.

 

Our investment universe is split broadly into two types of companies:

Transformers

Companies that need capital to digitalise their operations and adopting new business models

Producers

Producers of technologies that enable the advanced manufacturing sector but need capital to scale

We are builders.

We like to grow companies, not shrink them. We unlock value by using our expertise in modernizing and de-risking operations to increase revenue or decrease costs or operational risk – preferably all three. The 4th Industrial Revolution is picking up speed and now is the time to seize the opportunity and accelerate change.

How we do it

Asset 1

Expertise

Provide knowledge, expertise, synergistic relationships and actionable insights in 4IR to several stakeholders – from Fortune 500 companies to small family-run businesses.

Asset 1

Insights

Provide a way to convert those actionable insights into actionable investments.

Asset 1

Capital

Provide Capital to companies who want to participate in 4IR with our insights and access to capital.

Asset 1

Partners

Generate substantial returns for partners who would like to invest with us.

Fast Forward Manufacturing

While the first two factors may be temporary, the threat is perennial. It would be imprudent for any manufacturing firm to ignore them. These threats are catalysts for a new business problem: an unreliable and volatile value-chain – manifesting on the income statement as higher costs and lost profits.

 

Concurrently, the emergence of significantly higher data processing and Inference power over the last decade is indisputable. Artificial intelligence – the ability of computers to self-program – is still in its nascent stages. AI and the ability to merge the physical and digital realms on the factory floor are the tools required to de-risk the value chain.

 

The business problem and the tools required to alleviate the problem have both emerged around the same time. For many manufacturing firms, especially small-to-medium-sized ones, their entire value chain needs to be reorganized and digitized to make it resilient to volatile geopolitics and impending pandemics.

There is a grand confluence of events taking place right now that prompted us to become the 4IR investment company:

1.

The threat of trade wars and dissolution of trade agreements

2.

The threat of pandemics

3.

The emergence of a new paradigm in computing: AI

4.

The emergence of faster connectivity, e.g. 5G and Wifi6.

For both kinds of firms, we serve as a bridge to small and medium-sized manufacturing firms in Europe – a bridge between:

1.

Operational Improvements and cash flow impact

2.

Operational models and business models

3.

Near-term cash investment requirements and long-term returns

This bridge is built upon a solid foundation – The Oak Universe value creation plan. This plan is built over several iterations – from initial investment due-diligence to final implementation – by our 4IR Ecosystem. This Ecosystem separates us from other private equity firms. It is composed of leading engineers, PhDs, business and financial experts from eminent manufacturing firms and academic institutions. We at Oak Universe have put together an eclectic team of 4IR experts to support our portfolio companies.

 

The Value Creation plan – a bridge between value-chain enhancements and free cash flow improvements – is implemented by the portfolio company’s management team. Oak Universe serves as a partner in this implementation, providing expertise and capital when necessary. We expect that this capital invested at the early stages of the value creation plan will have a medium to long-term payback period, maybe between 5 and 10 years.

 

The majority of the financial impact will be felt in the form of savings in operating costs and in working capital. At every stage during the holding period, Oak Universe and its 4IR Ecosystem will constantly monitor and adjust the value creation plan.

Ultimately, our goal is to leave a portfolio company much stronger and more secure in a volatile sea of geopolitics. We believe that many European SMEs will gain from our vision and expertise, allowing us to generate returns significantly higher than those expected in public equity markets.

 

We view our investments in our portfolio companies as partnerships. We believe that we can generate maximum impact – operationally and financially – as partners, not as “barbarians at the gate”.

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