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Investment Liquidity and Returns

The investment holding period is:

  • 12-18 months to reach consolidation (closing event)
  • Additional 2-4 years to liquidity for a total investment time of 3-5 years

The target investment returns for Newcastle’s pre-consolidation and post-consolidation investments in SEM projects are:

  • Return on pre-consolidation incubation investments of $500K to $1M each: >35% annual IRR
  • Return on post-consolidation investments of up to $3M each: >35% annual IRR
  • Overall targeted return of >35% IRR

The exit options for Newcastle’s pre-consolidation and post-consolidation investments are:

  • Portfolio company liquidity event through sale or IPO
  • Recapitalization of portfolio company to take out Newcastle’s holdings
  • Leverage Portfolio Company holdings to make new investments