Underwrite the business. Not the excitement around it.
AI capability, customer adoption and company economics move on different timelines. We examine the business evidence behind a claim, including full costs and downside risk.
Our method separates customer value, company economics and investment terms. The fund and allocation policy remain in development. This is not an adopted policy, completed portfolio or offer to invest.
Anonymised client case study
- Year-one customer ROI
- 20%
- First-year incremental benefit
- USD36,000
- All-in first-year cost
- USD30,000
- Net first-year benefit
- USD6,000
An anonymised first-year client result, including setup and recurring delivery costs. Economic benefit is not necessarily cash savings; this is customer ROI—not fund or investor performance—and results for other clients may differ.
First-year customer ROI = (USD 36,000 − USD 30,000) ÷ USD 30,000 = 20%.
Our research priorities
Professional and operational workflows need a defined task, buyer and budget. We examine legal services, financial operations and other enterprise workflows where delay or error carries measurable costs. Paid usage, implementation time, repeat purchasing and customer references matter more than a demonstration. We test adoption assumptions and whether buyers can justify renewal.
AI infrastructure must support integration, evaluation, security and governance under real workloads. We examine retention, usage economics, switching costs, interoperability and ownership of data or workflow. Temporary provider pricing, upstream concentration and hidden manual delivery can weaken margins. We also test whether a model provider or larger platform could absorb the capability.
Complex environments require reliable outputs, auditability, data permissions and clear responsibility for human oversight. We examine IP ownership, assurance materials, error handling and contractual obligations. Unresolved rights, unverifiable claims or permissions the company lacks can prevent adoption. These issues affect sales cycles, liability, product design and delivery costs.
The economics of an investment
Customer ROI compares a documented baseline with the full benefit and cost of adoption. Include implementation, training, integration, model usage, support and human review. Released capacity is not necessarily cash savings; the client result above is not fund performance.
We assess recurring and one-off revenue, concentration, cohorts, retention and margins after delivery costs. Cash burn must connect to a demonstrable milestone.
Investment analysis tests the security, entry price, rights, dilution, financing needs, exit timing and downside. Hypothetically, US$500k at US$10m post-money buys 5% initial equity before dilution. That arithmetic is not a holding.
From evidence to a decision
We first identify the company, product, buyer and commercial problem. A screening note records why further work is warranted or why we decline. It also records introduction sources, relationships and financial interests that could affect judgement.
Detailed assessment tests demand, finances, runway, capitalisation, contracts, IP, data rights, dependencies, competition and governance. We distinguish company assertions, checked facts and assumptions. An evidence schedule assigns unresolved questions to owners.
We then challenge valuation, ownership, investor rights and future financing needs. Base, downside and upside cases identify conditions that would invalidate the thesis. We compare investing with declining. Portfolio assessment records concentration, shared dependencies and reserve implications; different companies can share the same underlying risk.
The decision record includes conflicts, approvals, execution conditions, reapproval triggers and the investment memorandum. Investment remains conditional on mandate, permissions and completed documentation. Monitoring tracks operating evidence, financing and governance, with actions, owners and review dates. A higher valuation alone does not prove a stronger business.
Annual planning assumes 200 screens, 25 detailed assessments and 5 investments, not completed activity. The six-week decision target begins after sufficiently complete materials, subject to the work required. It is not a transaction-completion guarantee.
The investment memorandum
The memorandum explains the problem, budget holder, customer evidence, competitive alternatives and defensibility. It records revenue quality, delivery economics, runway, ownership, rights, risks, valuation and instrument. Exposure, reserves, conflicts and reasons to proceed or decline must be explicit. It explains what must go right and what could invalidate the decision.
Proposed fund design
Alderwick Fund I LP. Proposed design only.
US$20m
Fund target, not capital raised
- Initial investments
- US$10m
- Follow-on reserve
- US$6m
- Modelled life-of-fund fees and expenses
- US$4m
Initial investments are planned at US$250k–750k, with a modelled US$500k average across approximately 20 companies. The proposed initial investment period is four years; fund life is ten years.
These are planning allocations, not deployed capital, commitments, adopted terms, portfolio holdings or fund performance. Stage, geography, security terms and allocation remain subject to mandate decisions and governing documents.
The follow-on reserve represents 30% of gross commitments. Further funding requires supporting evidence; it is not automatic. A modelled US$1.5m total cost-exposure ceiling per company includes initial investment and follow-ons. That is 7.5% of gross commitments, not a target allocation for every company.
Initial capital and reserves serve different purposes. We assess financing needs, dilution and the evidence needed before accepting further exposure.
Begin with context
The proposed minimum LP commitment is US$100k. This is a planning assumption, not a subscription term, eligibility test or invitation to transfer funds. Final terms and investor qualification depend on applicable requirements and documents.
Professional enquiries should explain their purpose and connection to Westminster's research or investment initiative. A conversation, event attendance or referral is not an investment commitment.