In This Issue
A Message from Mike
VCP Announces Investment in D Square Energy LLC
Articles of Interest
CNN Money - "Small Business Loans: $10 billion evaporates" Portfolio.com - "Capital - SBA's Vanishing Act" Zachary Scott Investment Bankers' Insight - "The Bank Capital Shortage" The Wall Street Journal - "Avoiding a Lost Decade for Growth" The Wall Street Journal - "LPs and Alternatives: Turn that Frown Upside Down The Wall Street Journal - "LPs are Back, but Some are Looking for Fund Right Sizing The Wall Street Journal - "Private Equity's Cash Problem"
News and Views
Dear Mike,
Welcome to Vanderslice Capital Partners' "News and Views". We have designed it to provide news and perspectives from our small corner of the private equity world. VCP's "News and Views" will include brief updates from Managing Principal, Mike Vanderslice, and links to private equity related articles that we hope are of interest to you. We welcome your feedback and look forward to hearing from you. Please feel free to e-mail Mike at michael@vanderslicecapital.com with thoughts, comments and questions.
Six months ago, Bruce Michels and I started Vanderslice Capital Partners (VCP) with a seemingly simple idea.
Originally, it went like this:
"Let's organize and professionalize the placement of private capital in smaller, operating stage middle-market companies at a lower transaction size than is typically done by larger private equity groups."
We've stayed true to this idea, but the methodology has evolved significantly. Our investment approach now supports equity investments of $500K to $5M, with our sweet spot being $2M from VCP resources. We also have the ability to lead on equity financings up to $5M with the participation of other private equity groups.
As far as we know, we are one of only a handful of private equity groups investing at this level and in this style in the Northwest.
We were motivated to start a private equity fund for three reasons:
Since then, we've managed to raise a fund, close a deal, create alliances with two larger private equity funds for co-investment, land an institutional investor, build a pipeline of other potential deals, and establish ourselves in the Private Equity Community here in the Northwest.
Whew!
Along the way, we've refined an investment methodology, organized our investor group, and done more meetings and presentations than we would like to recall.
The good news? It's all coming together!
We'll use "News and Views" to keep you periodically updated on our progress, and to provide perspectives on the private equity landscape that we hope will be of interest. In this issue, we spotlight our recent investment in D Square Energy (see article below), and provide links to especially worthwhile reading regarding current trends and events in private equity.
We especially recommend the article republished from the Zachary Scott Investment Banker Insight Newsletter (Winter 2010) entitled "The Bank Capital Shortage". We can find no more compelling explanation of the case for middle market private equity investing than the one made by Zachary Scott.
Enjoy, and thanks for reading!
Vanderslice Capital Partners (VCP), a private equity firm focused on smaller, middle market companies located in the Northwest, has announced an investment in D Square Energy LLC (the Company). D Square Energy sells and supports standby power systems for industrial, commercial and residential customers.
Founded in 1989 by Don Dunavant - President, D Square Energy is the largest independent industrial electrical generator dealer in the Northwest, serving Washington, Oregon and Northern Idaho. In 2009, the Company was awarded the IDC-Central distribution rights for the Pacific Northwest by Generac Power Systems, Inc., a leading manufacturer of standby power systems in the United States. D Square Energy is based in North Bend, WA.
The equity investment made by VCP is part of a growth strategy to further develop D Square Energy's sales and support infrastructure. This will allow the Company to better serve a growing Northwest customer base for Generac products and to build increased operating value in D Square Energy Services. Michael Vanderslice, Managing Director of VCP, will assume a seat on the board and will remain active in assisting management in strategic, financial and governance matters.
"We were looking for an equity partner with the knowledge, background and experience to help us grow and build value in our company but who would also bring an operating style that we are comfortable with," said Don Dunavant. "Vanderslice and the investors behind VCP bring a deep background in growing and operating companies such as ours, and we couldn't be happier to have them as our partner."
According to Vanderslice, "Our investment in D Square Energy LLC is part of a long-term strategy to support Northwest companies with a promising future and successful history that cannot access the financing needed in the current credit environment. We are actively seeking opportunities in manufacturing, distribution and service related businesses for which we can provide a strategic perspective and specific operating skills that complement those of existing management."
For more information regarding D Square Energy LLC, please visit their website at http://www.dsquaregenerators.com.
Thank you for reading VCP's "News and Views".
Vanderslice Capital Partners seeks to invest in expanding small businesses and lower-middle market companies with both sustaining and growth capital, while assisting portfolio companies in growing and strengthening their businesses.
Best regards,
Michael Vanderslice Vanderslice Capital Partners