Friday, September 20, 2013

Evergreen Engineered Performance

Evergreen direct investing is purpose-built to empower large, purposeful and powerful stewards of an evergreen trust to:

  1. engineer investment performance;
  2. simplify investment design;
  3. internalize investment management;
  4. save on investment expenses; and
  5. exercise control over investment impacts on society, the economy and the environment.
The idea map, below, is offered to illustrate these features.
  1. Priority cash sweeps de-risk the investment by recovering entrusted funds and realizing a fiduciary level of return within the limits of an engineered base case. This happens during the earlier years, when the risks are more clear and strategies can be pre-agreed.
  2. Ongoing participation in ongoing cash flows by the investor beyond the base case makes the investment evergreen. This is "upside" to the investor.
  3. Increasing cash to enterprise leadership as pre-agreed performance milestones are passed rewards effective leadership and allocates risk of changes in the ecosystem of competition over time to those best able to adapt to those changes as things evolve.
  4. Interests of enterprise and investment are aligned around optimizing commercial competitiveness to sustainably generate open-ended, ongoing and evergreen cash flows.

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