At the Boston breakfast meeting this week of the Association for Corporate Growth, venture capital fund managers discussed how they do business, and the impact of the presidential election. The answer: there will be changes in the business environment, but it is necessary to continue to evaluate investments based on fundamentals, as usual.

Dana Callow of Millennia Partners and Deepak Sindwani of WaveCrest Growth Partners agreed on fundamentals in selecting companies: you need to take a macro view, look for markets which are growing, have a reasonably long time line, and do not get distracted by inevitable changes in the world as you move forward in building great companies. If you build great companies, the money will follow.

The speakers were primarily focused above the seed/A-round of investing. Deepak’s fund is for “growth capital” for firms with revenues and EBITDA. Callow, whose fund focuses on healthcare, will invest with companies with zero to five million dollars of EBITDA, tending toward the lower end of the range, but clearly above the seed/A-round level.

The impact of the election?

For Deepak, whose investments are primarily in the B to B software space, his companies are most affected by “high end” immigration, corporate tax and trade. He speculated that the first two issues would be resolved favorably but trade was a “wild card.” He did not think that companies of less than $50 million dollars of sales would be substantially affected by the election in any event.

Dana similarly seemed unconcerned by the election, noting that the Affordable Care Act was destined for substantial re-write even in a Democratic administration, and that simplification of the approval process in the FDA would be a benefit.

Other significant takeaways include the following:

The investment focus has to be in a robust and growing vertical; Dana for example wants a space to be highly competitive, and looks for “forty or fifty companies” or else he thinks it is likely the wrong vertical.

Best IRR has come from funds with $250 million to $350 million dollars to invest. First time funds tend to be the most successful.

While seed money has mushroomed in the Boston market, A-rounds have become difficult. Growth capital at the low end is also difficult, but easier at the high end. Capital is generally available in the buy-out space.

Family offices are a significant support for raising funds. Family offices tend to be long term investors, and co-investors, and are favored by fund managers.

Finally, there was substantial emphasis on the quality of the CEO. You need to be in a company for the long run. The world will change, and you need a quality CEO to respond; some investment funds have venture partners whom they place on company boards or as advisors to assist in these responses, and they may even share in the fund’s carried interest.