For Private Equity
Quantifying Brand Value Through Customer Custody
CompassIQ measures the quality of customer relationships — the strongest predictor of enterprise value and the clearest signal of a brand’s growth potential.
Traditional financial models analyze lagging indicators — revenue, retention, CAC, and margin — but miss the upstream driver: relationship strength. CompassIQ introduces a new lens for investors and acquirers: customer custody — the measurable condition of how deeply a company owns loyalty, advocacy, and repeat purchase behavior.
By diagnosing the emotional and behavioral mechanics that create voluntary return and advocacy, CompassIQ provides a predictive, quantifiable view of brand health that directly correlates to future cash flow stability and growth velocity.
What CompassIQ Reveals
Each CompassIQ analysis measures 14 Essential Biomarkers of loyal customer behavior — the behavioral, emotional, and operational signals that determine whether a company can sustain growth efficiently.
Results reveal:
• The quality of revenue — distinguishing high-custody, recurring relationships from transactional ones.
• The profitability of loyalty — how customer behavior drives margin, not just revenue.
• The valuation uplift potential — the multiplier effect of customer custody on enterprise value.
CompassIQ brings the discipline of behavioral science and empathy-based strategy into private equity’s valuation frameworks — translating brand loyalty into measurable financial intelligence.
Why it Matters to Investors
Companies with high customer custody outperform peers in revenue efficiency, growth resilience, and market valuation. When relationships are strong, marketing spend is self-liquidating, cash flow stabilizes, and brand equity compounds.
CompassIQ gives investors and portfolio managers a clear, comparable benchmark for assessing:
• Brand risk and retention resilience
• Customer engagement quality
• Predictive value of advocacy and referral
• Underlying loyalty drivers influencing LTV and EBITDA
In short, it helps identify which businesses have customers that come back — by choice.
Proof of Methodology
Built on two decades of Compass + Nail’s data across leading brands such as Patagonia, goop, Prana, Seventh Generation, Mother Denim, etc., CompassIQ’s insights are benchmarked with the financial performance of high-custody brands.