Investment Principles

ALL BUSINESSES ARE

“PEOPLE” BUSINESSES

We invest in people and management teams who work hard, believe in a vision, have the discipline and focus to follow such a vision, and have absolute integrity

Invest in

Steady Performance

We are attracted to consistent, profitable performance with achievable growth objectives and operational improvement opportunities

Invest in Businesses

We Understand

We do not speculate on technology or products we do not understand

Niche

Companies

We look for leading market positions, high barriers to entry, high profit margins, and strong free cash flow

Prudent

Use of Leverage

Unlike many private equity investors, we structure our investments to maintain financial stability, pursue growth and maximize operational flexibility

Investment Criteria

Investing Across the Heartland

Midwest Geographic Focus

  • We invest primarily in businesses headquartered in the Midwest

  • While located in the Midwest, many of these companies provide products and/or services on a national and even an international basis with customers and supply chain partners that stretch to Asia, South America, Europe, Central America, and beyond

  • We have the experience and expertise to help our portfolio management partners make the most of these opportunities

  • We will also invest in companies located outside the Midwest where our skills and experience are uniquely able to add value to our investment and the owners and management share our core Midwestern business values

From $25 million to $125 million

Lower Middle Market Focus

  • Deal sizes generally between $25 and $125 million

  • Equity investment sizes generally between $10 and $30 million

  • Logical add-on acquisitions and/or product lines or services

EBITDA greater than $5 million

Companies with History of Positive Earnings

  • EBITDA greater than $5 million

  • Sustainable operating margins (usually 10% or higher)

  • Predictable capital intensity

  • Opportunities to grow revenue and improve earnings

We invest in what we know

Sector Focus

  • We invest in a wide variety of manufacturing and service industries, excluding real estate, technology, retail and commodities

  • We are particularly sensitive to technology and regulatory risks within certain industries

  • We invest in understandable businesses – we invest in what we know

For Investors

Our investors are primarily institutional entities that share our patient, focused, disciplined, long-term approach to private equity investing. We maintain an active dialogue with investors, and when feasible, schedule visits that coincide with our marketing and investment related travel. If you believe our approach to private equity is a good fit for your investment interests, feel free to visit us if your travel brings you to Minneapolis.

For investors seeking account information, please follow the ‘Investor Login’ link on the Homepage to access your LP information.

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