Based on both our management team’s experience, combined with the current trends they are observing, we have developed the following strategy and set of criteria we intend to utilize in our pursuit of a business.
Businesses with robust local presence, clear expansion opportunity in the Americas, and significant US Dollar-denominated revenue, with a broad focus across all TMT verticals. We see strong secular tailwinds in these sectors that we believe provide the necessary runway for general industry growth and profitability over the next decade. As global commerce becomes more globally interconnected, we believe a larger portion of economic participation will take place adjacent to or within the different verticals.
Initial focus on pockets of ultra-high growth within mobile and digital technologies, which are part of strong transformational technological trends that have accelerated due, in part, to the COVID-19 pandemic. Specific verticals include, but are not limited to, cloud infrastructure, artificial intelligence, mobile applications, digital advertising, digital content, media, fintech, e-commerce and mobility. Businesses throughout North America and South America are now looking to channel their commercial activities through the mobile ecosystem, leading to the emergence of so-called “Super Apps”, and intend to capitalize on the increased ubiquity of the smartphone, as well as now-prevalent and improving internet connectivity. Incumbent players are actively looking for solutions that allow them to drive engagement and customer behaviors, preferably through proprietary channels, instead of having to go through the incumbent ad giants. Our focus does not limit us to the TMT sector, as we believe there are ample opportunities that capitalize on these trends within other sectors such as healthcare, retail, financial services, real estate, hospitality, agribusiness and others that rely on technology-driven solutions to improve their business models.
Established, well run and profitable companies operating in a range of services and markets currently unpenetrated by global giants. Well-capitalized players are positioned to use the slowdown as an opportunity to strengthen their long-term strategic positions. We intend to prioritize companies that have visible opportunities and deploy capital in this environment to make acquisitions or accelerate organic growth opportunities.
A focus towards recurring contractual revenue and a clear roadmap to increased user monetization and monetization engine scalability. This is enabled by “sticky” relationships with customers, which in turn are derived from a superior customer experience and high switching costs, among other competitive advantages. Most sectors are facing uncertainties amid the COVID-19 pandemic, but other businesses that enable the “new normal” have benefitted. Growth businesses with strong value propositions and innovative products, with opportunities to deploy capital at high risk-adjusted returns, are of particular interest.
Proven high-growth trajectory, with potential for geographic expansion to continue delivering growth and achieve profitability within a reasonable timeframe. After dominating initial markets, target companies should have an edge to expand geographically to untapped or underserved regions where similar needs exist.
Experienced management team. We intend to consummate a business combination with a business that has an experienced management team with a proven track record for generating shareholder returns, producing corporate growth, enhancing profitability, generating positive free cash flow, and with an ability to clearly and confidently articulate the business strategy and market opportunities to public market investors. Management should also be experienced in successfully identifying, transacting, and integrating acquisitions. Where necessary, we may also look to complement and enhance the capabilities of the target business’ management team by recruiting additional talent through our network of contacts. This may include recruiting experienced industry professionals to assist in our evaluation of the opportunity and marketing of the initial business combination prior to its completion, who may ultimately assume an ongoing role with the combined company. While not a requirement, we would prefer opportunities where members of the management team of the target have experience as public company officers or other substantive public market experience.
Sourced on a proprietary basis. We do not expect to participate in broadly marketed processes, but rather will aim to leverage our extensive network to source a proprietary initial business combination. Notwithstanding the foregoing, we would consider participating in a process that is focused primarily on special purpose acquisition companies, where we would not compete with a conventional initial public offering or private equity acquisition, or where the target is at the tail end of a strategic process in which other alternatives have been eliminated. We would expect to compete in such processes on the strength of our prior experience in closing business combinations, understanding of the target’s industry, ability to add strategic value, or because our company is most appropriately sized to the target.
Preparedness for the process and public markets. We will seek to acquire a business that has or can put in place, prior to the closing of a business combination, the governance, financial systems and controls and investor relations capabilities required in the public markets.
Notwithstanding the foregoing, these criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation materials or tender offer documents that we would file with the U.S. Securities and Exchange Commission (the “SEC”).