Introduction To LTI
221 Danbury Road Wilton, CT 06897
– LTI At A Glance
– Marketing Efforts
– Credit Process
LTI At A Glance
Specialty finance company founded in 1983
LTI serves emerging growth companies and venture capital
backed startups in the U.S.
We offer equipment leases and loans to customers as a growth
and equity conservation tool
Since inception, LTI has originated over $300 million in
transactions involving over 500 customers
Transactions typically range in size from $250,000 to $2.5
million. Terms typically range from 18 to 48 months (36 month
Headquartered in Wilton, CT. Regional offices in Boston and
LA. Services are offered nationally.
LTI Background: Brief History
Founded in 1983 by Jerry Sprole, George Parker and Arnie Hoegler
Originally focused on FMV leasing of technology equipment to Fortune
companies until the early 1990s
In the early 1990s, LTI made the strategic decision to target emerging
growth and venture capital-backed startups
LTI grew profitably to over $100 million in assets and $19 million in
revenues by 2000 (achieved 15 consecutive years of profits and
booked over $300 million in leases over this period).
A terminated purchase of LTI by a Fortune 500 energy company just
prior to the 2001 downturn led to LTI’s restructuring/downsizing
A successful legal settlement at beginning of fiscal 2006 allowed LTI to
resume originations and growth.
LTI presently is pursuing a growth strategy consisting of originating
transactions for its own account and managing structured lease funds
sponsored by a major NYC investment advisory firm.
LTI Background: Management
Jerry Sprole, President: has 35 years in equipment financing, venture
lending and banking. Formerly CFO at Intech Capital Corp. and VP at
Bank of Boston. Past Board member of EAEL association.
George Parker, EVP & CFO: over 30 years in equipment financing,
venture lending and banking. Formerly VP-Treasurer at DPF Computer
Leasing, Inc. and Second VP at Continental Illinois Bank. Present
Treasurer and Board member of NEFA assoc.
Arnie Hoegler, EVP & COO: over 30 years in equipment financing,
venture lending and accounting. CPA and formerly Sr. Audit Manager
at KPMG. Past President and Board member of EAEL.
Hugh Baum, Corporate Counsel: over 35 years in equipment
financing, venture lending and legal work. Formerly Counsel for
Randolph Computer Leasing and Partner in private practice.
LTI Background: Value Proposition
LTI’s financial services assist young growth
companies in conserving equity capital,
building enterprise value between equity
rounds, and minimizing ownership dilution.
LTI Background: Market Positioning
LTI is positioned as a national provider of equipment financing to
emerging growth companies and venture-backed startups in the U.S.
LTI targets growth companies, primarily in technology markets, that
have already received their A - round of venture capital financing, that
have begun marketing their products or service, and that are typically
ineligible to receive traditional bank financing.
LTI offers its customers flexibility and efficiency in the form of well-
structured financing solutions, enabling them to conserve equity
capital, to fund equipment purchases as needed, and to avoid
ownership dilution and loss of management control. Flexible
transaction sizes of $250,000 to $2.5 million, lease and loan terms that
range from 18 - 48 months, and funding availability for up to one year,
allow these companies to satisfy most of their equipment needs.
Unlike many of its competitors, LTI offers customers flexible equipment
financing without the requirement of warrants or board participation.
LTI Background: Markets Served
Venture-backed growth companies
Emerging growth companies with positive
Structured FMV transactions for major
Vendor lease programs requiring FMV leases
Market Overview: Venture Leasing
VCs invested $28.3B during 2008 compared to
$105B during the 2000 peak and $8B annually
during the mid-1990s
Venture Leasing/Equipment Lending has historically
totaled 5% – 10% of aggregate VC investments
Market Drivers: economic growth, innovation,
financial liquidity, and available exit channels
Competition: a few banks, several specialty
leasing/finance cos., and a few dedicated lease
Lessee prospects: 2,500 to 3,000 VC-backed
companies per year that raise new equity rounds.
Direct Sales professionals
Referrals from banks, past & present
customers, and other contacts
In-house direct marketing
Credit Process: Key Credit Criteria
The caliber and amount of Venture Capital
An experienced and talented management team
Compelling business model and prospects
Adequate operating track-record relative to
Sufficient cash and liquidity
Equipment: mission-critical and readily re-marketable
Adequate credit enhancements and security
Summary and Outlook For LTI
Although the economy has slowed significantly with a resulting softness in
capital goods acquisitions, demand for equipment leasing within the emerging
growth and venture-backed segments has not slowed as dramatically as many
other leasing segments.
Many VC-backed companies receiving new equity rounds today have survived
the triage process of their VCs. They represent the most compelling situations,
many having met or exceeded significant milestones.
The credit squeeze has caused several of competitors to either abandon the
market or to significantly reduce their activities, creating a unique opportunity to
gain market share and to acquire transactions with excellent returns and
LTI has already benefited from these market conditions and its disciplined
marketing efforts. We anticipate being able to further exploit these market
dynamics over the next year.
LTI has secured sufficient lease commitments to fill the first Fund ($20MM), and
secured additional commitments to jumpstart the next fund. We plan to pursue
a dual strategy of developing our internal portfolio utilizing bank financing while
continuing to expand via our Fund partnerships.