If Sagard doesn’t use IRR to measure performance, what does it use?
Rather than seeking a high IRR in the short run, we seek a reasonable money multiple on our initial investment in absolute terms. Even if that takes 5 or 7 years, we are willing to wait. This way of measuring performance ties in with our overall investment philosophy, which is based on supporting the ambitious growth objectives of management teams. What does it mean to you to be a “long-term investor?” Our aim is to assist management teams in transforming the companies in which we invest and reinforcing their competitive position. Changes of that magnitude can’t be achieved in just a few months. We facilitate change by giving the companies that work with us the benefit of our financial resources, our experience and the experience of the many corporate leaders and decision-makers associated with Sagard. Our business model encourages us to give management enough time to make the necessary changes. That is what a long-term investment horizon means to us.
