Chicago Growth Partners

How we find great executives and how they find us

dmathews — Thu, 15 Mar 2012 20:48:29 +0000

Our approach to investing has always been to let management run their company while we help to fill in the gaps where and when necessary. The relationship starts after we meet a team that shares our approach to building growth companies and work out a reasonable transaction for both sides. In the market segment in which we invest — small growth companies — management teams are rarely full from top to bottom. They might be ready for a CFO, or senior executives might be wearing multiple hats so there is an acute need for more focused talent as the business scales. We see this time and time again — rapidly growing companies with great products but missing key pieces of the team.

We constantly find ourselves in the market searching for experienced executives to join our portfolio companies. We often joke that we are actually executive recruiters disguised as private equity investors. There is a lot of truth to that. We find executives in the all the traditional ways — introductions from colleagues, from other portfolio companies and from retained searches. In addition, we also think there are great ways to harness technology and social media to stay closer to people over the course of their careers.

To that end, we created The Leadership Network as our key resource for finding talent to add to our portfolio companies. We maintain a detailed list of senior executives and their resumes by functional role in our CRM so we have an immediate source of relationships at our fingertips whenever one of our management partners has a need. Our LinkedIn group keeps us up-to-date on an individual’s career movement over time and so we can efficiently reach out with updates on our activities in case there is a great match we might not have otherwise have noticed. We also get to hear from the executives we know about new investment ideas or people they might know to add to our network.

If you would like to join our Network, please send a copy of your resume to Leaders@cgp.com AND please join our LinkedIn group The CGP Leadership Network so we can keep in touch. Moreover, if you have a colleague who would like to get to know us, please forward this on to them. We look forward to talking soon.

What we look for in new investments

dmathews — Mon, 05 Mar 2012 17:45:29 +0000

Our investment process starts with two basic criteria — industry and growth.

We execute an industry-driven investment approach focused on growth companies in four dynamic sectors where we have extensive investment experience – Education, Healthcare, Tech-Enabled Service and Industrial Growth. We have a long track record of partnering with management teams to build leading companies for which strategic and financial acquirers will often pay attractive multiples upon exit.

Across these sectors, we look for common characteristics to find companies that best suit our style.

Differentiated product or service.
Stable, highly visible, or recurring revenue.
Low or no customer concentration.
Dynamic market where above average growth can be sustained during and after our ownership period.
Valuation where we believe we can deliver attractive returns based on conservative assumptions.
Management team that is excited to partner with us and who values our operational approach to building great growth companies.

One small step for private equity, one giant leap for Chicago Growth Partners

dmathews — Mon, 30 Jan 2012 12:00:34 +0000

Why should a private equity fund blog? And why should you care?

While we don’t yet have the answers to these questions, we do hope that over time the audience who finds these posts will appreciate our attempt. With this blog – let’s call it a conversation – we hope to broaden our influences beyond our own walls and to share with you a little bit about how we approach the business of investing and helping companies grow.

At Chicago Growth Partners, we have built our reputation by partnering with entrepreneurs and by being steady hands in managing our limited partners’ capital. Maintaining these relationships requires transparency, trust and a healthy dose of humility. And while we don’t always get it right, we certainly try to learn from our mistakes.

So far, this feedback loop has aided us over the two decades our team has been investing in growth companies. This blog is our small attempt to use our new web site as a platform to expand that feedback loop and make us better at what we do in the process. Wish us luck and please pass this along to those who might benefit from being part of the conversation.