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Our Investment Philosophy
Blue Chip is committed to helping our partners build lasting enterprises. We earn management's respect by being a
creative and flexible partner who understands that time is precious and speed is essential. And we're proud to be
the investor partner that management calls first when seeking advice, support or guidance.
Our investment philosophy is to:
Partner with companies that have strong, experienced executive teams.
We prefer to work with executive staff and management teams that are highly ethical, passionate and strategic and have a proven track record
of success. Our approach to venture capital investments and to the business-building process is the reason our successful entrepreneur partners
return to us when seeking funding for their next successful enterprise.
Serve the role of an active lead investor by structuring and negotiating new investment opportunities.
Blue Chip approaches all partner relationships with a leadership mindset
that will continue throughout the growth and development of the partner
company. In fact, in more than 75 percent of our investments, we embrace
this leadership role. Our commitment to lead is further illustrated by
the fact that we occupy a seat on the board of directors of virtually
all of our partner companies.
Capitalize on our leadership position in the Midwest
We invest about one-half of our capital in companies located in the Midwest, a region in which Blue Chip has developed a strong presence.
Invest in early-stage companies.
Our goal is to maintain a sharp focus on Media & Marketing, Healthcare, and Software & Services companies seeking first- and second-round funding.
Investment Criteria
Targeted Industries – Technology companies serving the media & marketing industries; healthcare companies,
including healthcare services, specialty providers, and clinical-stage drug and device companies; software companies; and technology-enabled
business service companies.
Targeted Return – An IRR of at least 35%; typically five times invested capital, dependent upon the company history,
level of risk, projected growth and the potential for other stakeholders to share appropriately in the companyÕs projected value.
Management – Inspired entrepreneurs with high integrity and a record of building successful enterprises,
preferably in the industry of the company or a comparable industry.
Stage of Development – Investment candidates will typically have revenue, but not yet be profitable.
Investment Size – Generally $4 to $6 million per company, usually over a number of rounds of financing.
Investments may be as low as $1 million in the first round.
Investment Form – Equity investments, typically in the form of convertible preferred stock.
Where appropriate to meet the companyÕs needs, the investment may include a bridge loan component with equity enhancements.
Geography – Focus on the Midwest and Northeast, while investing throughout the US and Canada when other investment criteria are met.
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