We firmly believe in investing behind a management team more than a business plan, and therefore look to partner with driven entrepreneurs who have deep domain expertise in their target market. Additionally, we look for leaders who have proven their capacity to build a business and prefer sales-oriented founders with previous experience managing an enterprise sales process.
We target business-to-business (B2B) software companies that provide software solutions and technology enabled services. Areas of particular interest to Osage are application software, software as a service (“SaaS”), cloud computing, healthcare IT, education technology, data analytics / business intelligence, and infrastructure management software.
We invest in companies headquartered on the East Coast of the United States, with a particular focus on Boston to Washington, D.C. We believe the East Coast is short on early stage capital but long on opportunities in B2B software given the concentration of talent and potential customers.
We prefer companies with product based, recurring revenue models over project based models. We also invest in models with strong services built around deep domain knowledge migrating to software or models initially focused on a mix of perpetual license revenue and recurring revenue. Additionally, we look for businesses that bring disruptive innovation, rather than step change improvements, to sizeable markets in excess of $500M.
While we are early-stage investors, we prefer companies with proven market traction, which we define as having achieved, or having clear visibility into, an annual revenue run rate of at least $1.0M. We look for companies that have market validation from multiple sources, including several customers, channel partnerships, or license agreements.
We prefer companies that have the potential to achieve cash flow break-even or reach an exit with less than $10M of total equity capital.
Deal Size and Structure:
We prefer to invest in a company’s first institutional round , and will typically invest $1.0M – $3.0M initially as part of $1.0 – $5.0M capital raises. We typically reserve 1x – 3x the amount of the initial investment for follow-on financing. We typically lead or co-lead investments, and prefer to invest alongside like-minded syndicate partners.