KBH’s investment philosophy plays a significant role in the firm’s successful track record. KBH believes in running businesses to be cash flow positive and profitable every month. Start ups and companies in a start up mode, such as one that had been purchased in distress, are expected to generate revenue within the first six months and reach profitability within the first 12 – 18 months. KBH also only invests in or acquires companies that are in the start-up phase or have less than $20MM in revenues. KBH targets technology companies that offer business to business services. Typically, KBH is the majority shareholder of its investments.
KBH investment timeline in each portfolio company is from 3-5 years. During the first three years of a portfolio company, the KBH team focuses on aggressive investment sales and operations strategies and efficiencies. After the three years the KBH approach is to continue to grow and execute on its company’s goals while finding more aggressive growth opportunities for the company through different merger and acquisition potentials.