Corporate Investments

 

What type of investment structures?

We look  to invest in the following…

  • Working Capital partnerships—through a minority (10% - 40%) or majority (60% - 80%) investment in a company and its management, we provide financial and other resources to help leadership maximize the company's potential

  • Family businesses—we look to perpetuate family businesses by providing long term funds with ability to create either a long-term partnership (see above) with or sell back stake to family once need has diminished

  • ESOPs—unwind or co-invest in a minority position

  • Non-owner management buyouts—fund the buyout, providing structures where existing (successful) managers can acquire substantial stake (typically 20%+; minimum 10%) in the businesses that they have built

  • Balance sheet restructurings – we can pay off debt, add equity &/or provide working capital to eliminate barriers to growth

  • Ownership recapitalization—we can acquire a majority stake (60% - 80%) in a business providing substantial capital return to owners, replacing all debt (thus eliminating any personal guarantees ownership may have), funding sufficient working capital reserve while allowing management to remain in their current positions to maximize the company’s potential

  • Acquisitions—in those situations where we already have a platform with a strong management team in place, or have a management team looking to lead another company, we may acquire 100% of a company

In what industries do we prefer to invest?

We are mostly industry-agnostic (although there are some that get us more enthused than others).

That being said, there are six primary criteria that we look for when making an investment: 

  1. Shareholders—are the macro & micro dynamics such that the company can double in 2 to 3 years &/or triple in 5 to 7?

  2. Employees—are your employees motivated to come to work, do they feel empowered and part of a solutions? What is your employee culture?

  3. Customers—do you have a high net promotor score (NPS) or equivalent? Do you have rabid fans?

  4. Vendors—do your vendors feel like a partner in your business success or do you treat them like a necessary evil?

  5. Community—local, regional, national and global, is your contribution to each of those communities positive? What non-business endeavors do you support and/or sponsor?

  6. Individual families—are your employees’ families better off because they work there? Do your employees have adequate quality time to spend with their family?

Key Attributes of a desireable investment

We look to invest in companies that have…

  • Steady growth(1)

  • Progressive ideas with sustainable products, services &/or concepts (2)

  • Strong leadership teams(3)

1  We are longer-term investors that like to invest on the way up a growth curve that has many years remaining, not a quick, “flash” curve that lasts for but a brief period of time

   

2   We are looking to invest in companies that have well thought-out products, processes and execution strategies

   

3  We require a strong, experienced CEO with current or planned CFO & applicable key operating C-suite leadership that plans on remaining through anticipated growth curve

What are non-starters for us?

We do not invest in the following areas:

  • Proactive fossil fuel advancement (exploration, refining)

  • High-risk, low margin commodities (gravel, grains),

  • Pollutants (coal, heavy industry, chemicals),

  • Sectors with high government risk (Medicaid, Medicare),

  • Outdated or soon-to-be-outdated products or concepts (combustion engines, department stores),

  • Seasonal/Fads—we typically stay away from seasonal, weather dependent, or products with a short expected life cycle (pet rocks, hula hoops, car washes, etc.) This also typically applies to fashion-related products (certain exceptions may apply)

  • Products or services that have active or passive negative consumer value (payday loans, tobacco, alcohol, high fat &/or sugar foods, tanning salons),

  • Addictive products (gambling, video games, pornography),

  • Abusive practices (child labor, unequal class / pay separation),

  • Non-defensive military (weapons)

  • Boring (catch-all subjective)

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