Sterling Partners Investment Thesis Challenge Investment Areas of Focus for Participating Firms

Transcription

1 Sterling Partners Investment Thesis Challenge Investment Areas of Focus for Participating Firms Sterling Partners Sterling Partners is a private equity and venture capital firm specializing in growth capital and buyout investments in small and middle market private companies. It typically invests in education, health care, business services, direct marketing, specialty manufacturing and distribution, and technology companies. It has a total staff of 75, six funds with ~$5B in AUM, and 30 portfolio companies. Sterling Partners makes control investments (e.g. more than 50 percent) in cash flow positive companies (e.g. growth capital not venture capital) that have proven business models and do not take technology risk. Education: The world has never been hungrier for educational services that deliver on their promise. We have proven for over three decades that world class student outcomes and value creation are not mutually exclusive. Health Care: There are a lot of fish swimming in this 2.5 trillion dollar pond. Only those that consistently deliver quality and value to patients or lower cost to the system will have staying power. Business Services: This large addressable market is full of differentiated B2B players that will matter in all economic climates. We have partnered with many of them over the years, and we re looking for more. See our portfolio companies in each of these investment areas:

2 Baird Capital private equity For 25 years, Baird Capital s US Private Equity team has made private equity investments in US based lower middle market companies. We focus exclusively on the health care, technology and services, and industrial/commercial products industries. We partner with exceptional operators and leverage our global perspective, knowledge sharing, and executive networks to strive to build exceptional companies. We also provide operational support to our portfolio companies through teams on the ground in Asia, a proactive portfolio operations team and a deep network of relationships which together deliver enhanced value. Technology and Services Marketing and data services Human capital services Insurance distribution services Franchising Professional services Health Care Infection prevention and management Health care marketing and communications Outsourced hospital/provider services and tools Revenue cycle management Rehabilitative care Industrial/Commercial Products Process controls Specialty packaging Water infrastructure Safety products

3 Flexpoint Ford, LLC Flexpoint Ford is a Chicago based private equity group focused on investments in financial services and healthcare. The firm was founded in 2005 and currently manages approximately $1.0B of committed equity capital. Flexpoint Ford seeks to build relationships with executives and companies who look for the firm to be a value added partner. Flexpoint Ford aims to invest $25M to $125M of equity in each opportunity. Financial Services Areas of focus include: specialty finance, insurance, insurance services, transaction processing, asset management, broker/dealers, trading technology, financial technology Representative current and past portfolio companies include: GeoVera Insurance Group Holdings: provider of specialty residential property insurance with a focus on catastrophe exposed property in the homeowners and residential earthquake markets, operating in both admitted and surplus lines markets Wisdom Tree Investments (Nasdaq: WETF): independent exchange traded fund sponsor, securities index developer, and asset manager with $17.2B of assets under management Financial Pacific Leasing: specialized commercial finance company focused on providing leases for essential business equipment to small businesses nationwide T&H Global Holdings: provider of specialized insurance claims services to insurance carriers, insurance brokers, corporations, and public entities Retail Capital:provider of small business lending solutions through an emerging platform focused on data science and analytics Great Ajax REIT: Real Estate Investment Trust focused primarily on acquiring, investing in, and managing a portfolio of single family re performing and non performing first lien mortgage loans Pelican Auto Finance: originates used car loans to deep subprime borrowers through a network of independent auto dealers, primarily in the Mid Atlantic, Texas, and Ohio. Pelican services all loans in house and uses GPS and starter interrupt technology to enhance its collection activity and track its underlying collateral Flexpoint MCLS Holdings: formed in 2014 to invest in an existing Small Business Investment Corporation predominately originating life sciences loans to late development stage and early commercialization stage pharmaceutical, biotech, and medical device companies Jefferson Capital: acquirer and servicer of delinquent portfolios of consumer accounts, secured and unsecured consumer bankruptcies, and balance transfer program solicitations ARX Holding Corp: insurance holding company which, through its group of insurance companies known as American Strategic Insurance, provides residential property coverage in 21 states with an emphasis on the Southeast US Hilltop Holdings (NYSE: HTH): a publicly traded financial holding company that is a regional commercial banking franchise through its wholly owned subsidiary PlainsCapital Corporation Health Care Areas of focus include: health care providers, managed care, outsourced services and technology, distribution, pharmaceuticals and life sciences, and medical devices and supplies Representative current and past portfolio companies include:

4 Corva: provider of renal care to patients with chronic kidney disease and end stage renal disease Eagle Hospital Physicians: practice management company providing hospitalist contract services, telemedicine, and hospitalist temporary staffing American Medical Depot: distributor of medical and surgical supplies Home Solutions: home infusion pharmacy offering a full range of intravenous and other specialty therapies, focused in nutritional support, cardiac care, and pediatrics IntegraCare Home Health: home nursing and hospice provider based in Texas Senior Whole Health: managed care organization serving the Massachusetts dual eligible Medicare/Medicaid population

5 GTCR One of the oldest private equity firms in the US Founded in 1980, GTCR has invested $10B over its history Invested successfully in different economic environments Currently investing $3.85B Fund XI The Leaders StrategyTM positions GTCR to pursue differentiated opportunities Under managed Assets Expand geographic, customer, or product reach Bring cost synergies Facilitate more efficient capital structures Can be executed at accretive valuations Bring world class management leadership to lower middle market companies Transformational Acquisitions Identify and acquire non core assets from corporate enterprises Create stand alone enterprise and reposition within industry Accelerate growth by improving sales execution Improve efficiency by focusing on performance metrics Upgrade infrastructure and operations to position for public/strategic exit Health Care Health care providers Managed care Medical devices Outpatient services Pharmaceuticals/life sciences Information Services and Technology Software and online services Telecom and networks Data and info services Government services/aerospace and defense Media Financial Services and Technology Financial technology Transaction processing Asset management and distribution Financial institutions Insurance, insurance services, and distribution Growth Business Services Security alarm monitoring Business process outsourcing Logistics and distribution Route based services

6 Jump Capital Jump Capital is a Chicago based venture capital firm specializing in expansion stage and growth capital investments. Led by a team of experienced operating executives, we are value creators who take an opportunistic, long term approach to investing. We seek investment opportunities ranging from $2mm to $15mm in scalable technology businesses with compelling leadership teams across a wide breadth of industries including enterprise technology, marketing, healthcare IT, and financial services. Jump Capital takes an opportunistic approach to investing. Unlike most venture capital or private equity funds we take a long term approach and are not limited by a fixed fund life or narrow investment mandates. We seek great people and ideas within attractive markets. Although our investments are not industry or sector focused, we are enticed by opportunities that exhibit these attributes: Asset light businesses with B2B sales strategies Technology driven businesses Recurring revenue streams Compete in niche or defensible market segments Go to market strategies that leverage channel sales Areas of particular interest include: Financial technology IT security (enterprise and mobile) Health care IT and services Cloud computing and data storage Machine to machine data (the industrial internet ) Automation of knowledge work using big data and machine learning Agriculture technology

7 Madison Dearborn Partners MDP is a private equity investment firm based in Chicago. Since MDP s formation in 1992, the firm has raised six funds with aggregate capital of over $18B and has completed approximately 120 investments. MDP s founders adopted an industry focused investment approach over 30 years ago, and the firm has five dedicated teams that have long and successful track records of investing in their respective sectors. The five industry verticals are: basic industries, consumer, financial services, health care, telecom, and media and technology services. Health care Services Home care technologies (staffing, pharma usage) Hospital and post acute outsourcing (separate from revenue cycle management, other tech or service related); or purchasing interfaces on supplies and contracting Pharma clinical trials development (e.g., physician groups are circumventing traditional Clinical Research Organizations) Disease management, case management for certain morbidities Management of dual eligible populations (Medicare and Medicaid) where costs are high and payers/providers are not coordinated Medical products and device manufacturers Specialty pharmaceutical companies Life science and medical products distributors Dental products and technology manufacturers Home health care and community based human service providers Managed care and specialty managed care providers Specialized health care service providers, including diagnostic laboratories, kidney dialysis chains, and hospital outpatient surgery centers Health care information technology companies

8 PSP Capital Partners, LLC PSP Capital Partners is a private investment firm founded by Penny Pritzker dedicated to building businesses and creating long term value across the globe in close partnership with entrepreneurs, business owners, and management teams. Our principals have a strong legacy and long history of owning and building businesses (including Hyatt Hotels, The Marmon Group, Transunion, The Parking Spot, and Vi), and our organization is differentiated by a significant and permanent capital base, speed and certainty of closing transactions, flexibility with respect to investment structures, and a deep network of strategic resources. The firm seeks to partner with like minded business owners, management teams, and entrepreneurs in established, profitable, and growing businesses. PSP typically invests $15 100M per transaction in businesses with $5 25M of operating cash flow. The firm s industry verticals of interest include business services, niche manufacturing and value added distribution, and food and agribusiness. Business services Facilities and commercial services Facilities and maintenance management Environmental services Logistics and transportation services Document management Testing, inspection and certification Professional services Marketing services IT services Data analytics Education and training services Other tech enabled services Route based services Specialty finance, insurance and insurance services, and collections Niche manufacturing and value added distribution Mission critical, highly engineered and/or branded product manufacturers with demonstrated history of product quality, customer loyalty, and pricing power Value added distributors that provide further processing (finishing, kitting, assembly) and/or unique channel relationships, technology, and fulfillment solutions to its customers and suppliers Sub sectors and end markets of interest include: Building products (residential and non residential) Flow control (pumps and valves) Sensors and controls Precision machined/fabricated components Branded specialty application products Commercial/Industrial Energy Efficiency and Building Automation / Control Refrigerated warehousing

9 Food and agribusiness Food ingredients and additives Branded and private label food manufacturing Health and wellness focused food businesses Fast casual restaurant concepts or franchisees Agronomic inputs/specialty crops Specialty/niche food packaging

10 The Vistria Group The Vistria Group is a Chicago based private equity firm focused on investing in middle market companies in the healthcare, education, and financial services sectors. Vistria makes control investments in companies that have a history of positive cash flow and sustained organic growth. Vistria s team is comprised of highly experienced partners with significant investing and operating experience with a proven track record of working with owners/founders in building innovative market leadership companies. Education Health care Financial Services (asset light/non balance sheet related investments)