Middle Market Growth – Navigating An Economic Crisis, Q&A With VSS

MARCH 30, 2020
Navigating an Economic Crisis: Q&A with VSS

Patrick Turner, M.D.
Managing Director, VSS
Headquarters: New York City
Industry focus: Business services, health care, information and education
Investment criteria: EBITDA of $1 million to $25 million; investment range of $10 million to $50 million

Middle Market Growth spoke with Patrick Turner by phone on March 25.

Q. How is VSS working with its portfolio companies amid the current economic turmoil?

The first thing we did was make sure everyone was safe. We switched to remote work early on, and our companies reacted quickly. We’re focused on tech-enabled business services, so they can work from home in many cases.

The second priority was to do a 13-week cash flow forecast. What do costs look like, what do revenues look like, what are our customers saying in terms of what their visibility is into their own cash flow? In this particular environment, it’s changing pretty much every day, and certainly every week, so the forecast has to be revised continuously to ensure you have plenty of liquidity.
Our portfolio focuses on business and information services (cloud, AI, etc.), health care IT and digital education. As such, we avoid selling directly to consumers; most of our companies sell directly to corporations. Some of our companies have longer-term contracts, and many are integral to their customers’ everyday activities, so they can’t be taken out easily. That offers a bit more stability, and it’s proven to be the case in this situation.

For the full interview click here.