Strong Customer Loyalty Recurring Revenue Business Models
Sustainable Competitive Advantages Potentially High Cash Returns on Invested Capital
Prospero believes that strong leadership is one of the key factors in determining the future prospects of a company, yet it is invisible on a company's balance sheet and must be assessed by an investor such as Prospero over time and through in-depth analysis. Strong managers attract other strong managers and enable a company to anticipate important industry trends and take full advantage of market opportunities. Conversely, poor management can destroy value significantly by failing to recognize industry changes, under-investing in human capital, corporate infrastructure and product development, or making ill-considered acquisitions. Prospero also believes that it is important for the interests of management and shareholders to be aligned, preferably through management owning a large percentage of the company.