Paragon’s management has successfully raised over $50M using its participating debt strategy, resulting in an average return of over 20% (IRR). This unique debt investment strategy treats the investor as an owner for a defined term while avoiding the issues involved in divesting of private share capital. The investor receives the security and certainty of regular monthly payments plus the added bonus of participating in growing revenues earned from the expansion of the underlying business, just as an equity owner would.
Paragon typically invests $5M to $10M in each SME and will often make follow-on investments as the operating company meets its goals. Growing companies in the manufacturing, service, distribution or technology industries are targeted. These companies will have strong management, positive cash flow and a growth event that makes the participating debt model rewarding to the investor. Paragon is involved in the operation of the SME, both from a control and advisory aspect.