Investing — ReD Associates

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I N V E S T I N G

Investments are bets on people and society. We help PE firms accelerate growth and address risks by complementing their toolkit for assessing the human side of investing. Through deep customer understanding we help build more robust financial models and more impactful growth plans by identifying false assumptions early, by uncovering new growth areas in the core business and beyond, and by increasing the organisation’s ability to execute.

Throughout the investment journey, investment firms and portfolio companies are asking questions about people and society:

Which customer needs and societal trends should we invest in? [an assumption that’s baked into the investment thesis]
How is the target company’s offering experienced by customers in reality? How can these insights be used to drive company growth, future profitability, and moving into new segments? [assumptions that are made in the commercial due diligence]

What are the biggest unmet needs that we can grow our offerings around? What are the segments most likely to adopt? Which customer needs will we not serve? [assumptions being made in the full potential plan]
Why will customer needs not only persist but grow in the years to come? [an assumption that is critical in the growth story at the point of exit]

Most investment firms only use half the toolbox for understanding customers, typically, these are simple tools like surveys, expert interviews, and focus groups that are either quantitative in nature or easy to analyse and integrate into the financial model. The fact that most investment firms rely on these tools can bring some comfort, but there are substantial risks of getting people wrong by solely relying on these ways of understanding customers:

Risks overestimating future opportunities by extrapolating from the past

Blind-spot bias, leading to new opportunities going unseen
Risks focusing on the same or similar opportunities as everyone else

At ReD, we help investment firms accelerate growth by making better bets on people and society. We work with investment firms to complement their toolkit for understanding customers to drive growth in an effective, focused and low-risk way. We conduct both deep qualitative and quantitative research with the actual customers and stakeholders of the portfolio companies. We build on the methods and tools that have enabled us to work with some of the world’s most influential organisations to redefine their industries and apply them in a bespoke way to investment firms.

We help clients accelerate growth by:

Building more impactful investment themes and guiding principles by identifying emerging customer needs
Driving better due diligence decision-making by understanding how current offerings are experienced by customers
Unlocking new growth and create a high performing organisation by defining strategic focus areas for the next 3-5 years

Strengthening the growth story for future owners by defining the customer needs that will deliver long-term sustainable growth
Creating durable and meaningful growth that not only positively impacts valuation but also employee motivation and social impact