The Harava Business Model
Persistence and staying true to a unique business model is key to success. Leading a capital and business advisory firm for small and midsized organizations has been challenging and very rewarding. Post-recession we saw a number of great businesses that lack the resources to grow while others don’t have the technical know-how to able to scale up their operations.
We decided to open Harava to help businesses take advantages of our services. We have a capital advisory side and a business advisory side. The capital advisory side focuses on private equity investing, we look at organizations with great growth potential, we look at some metrics and criteria and based on that, we take equity positions and invest financially in those organizations. At the same time, we provide technical know-how to their management team to grow these organizations and scale them up. We put our money where our mouth is. We believe we can help turnaround those firms.
We are a unique firm as we are not the typical consulting firm. we provides businesses ability to gain strategic partnerships and have access to a team of advisors who would look at their business in a holistic way, dissect it, figure out the problem areas and help develop practical solutions. Our hybrid nature allows us to co-invest with selected clients and opportunities to enjoy the upside with them.
The Harava Investment Strategy
Harava investment strategy offers a clear path to value creation. The firm adopts a Buy-and-Build private equity investment strategy, otherwise known as Consolidation strategy. The strategy is to buy a strong platform company and building value by rolling into that platform company, new acquisitions of complementary businesses. The opportunity to tuck in smaller complementary businesses that could be acquired on a lower multiples, bring down the average cost of acquisition and improve overall value of the larger entity.
Why we adopt such strategy, Harava keep two things on our minds:
- Operational improvement;
- Multiple expansion.
Operational improvement focuses on change in EBITDA which is based on changes in revenues and changes in margins. Our goal is to develop a clear strategy on how to improve both revenues and margins.
Multiple expansion focuses on building a larger organization in terms of scale and scope and improving the growth profile. This strategy focuses on size premium, the bigger the company, the bigger the multiple.
We believe through Buy and Build investment strategy, we could improve the platform company’s market position, expand to new geographic markets, increase product offerings, cross sell products and bundled services for a larger number of customers and achieve a quicker rate of revenue growth than through organic growth. Additionally, we work to achieve cost efficiencies from costs savings through economies of scale, cost synergies and elimination of unnecessary cost centers.
As a go to partner for small and midsized business community. We are excited of the current business environment and the opportunities for value creations for our investors and clients.
Jay Jelenke, CEO
Harava Group, Inc