Four months after resigning as president and chief executive of Northern Trust Asset Management, Shundrawn Thomas is partnering with former Merrill Lynch executive Anthony Hoye to launch a private equity firm, The Copia Group.
The Chicago-based enterprise is being described as a “private investing firm that partners with founders to provide a distinct combination of growth capital and the support and resources needed to develop scalable, sustainable business models that generate equity and impact.”
The firm has partnered with Morningstar Sustainalytics to develop a proprietary social-impact framework that will focus on lower middle-market companies, providing credit and other financial solutions that limit the dilution of existing equity owners, according to the announcement.
With more than 50 years of combined experience identifying, investing in and growing successful businesses, Thomas and Hoye claim to have developed an intentional framework designed to achieve impact at scale.
“There is an evolving and expanding array of untapped opportunities in the private markets,” said Thomas, who joined Northern Trust in 2004 and served in several executive roles over his tenure, including as a member of the asset management executive team since 2008 and as a member of the management group since 2017.
Last year, Thomas was recognized by InvestmentNews as its 2021 Diversity, Equity & Inclusion Lifetime Achievement Award recipient.
When he announced his resignation from Northern Trust in May, Thomas referenced plans to co-found a new, diverse-owned and led business that will provide debt and equity solutions to privately held U.S. companies. He said a key focus will be identifying untapped market opportunities and partnering with women and ethnically diverse business operators.
“These opportunities are particularly prevalent in the lower middle market, which is growing faster than the broader market,” he told InvestmentNews Tuesday. “When we refer to the lower middle market, we generally are referring to established companies that generate between $10 million and $100 million in revenue and have positive cash flow dynamics.”
Thomas cited data from Capital IQ suggesting there are more than 95,000 businesses in the United States generating between $5 million and $100 million in revenue.
“These companies are relatively underserved, and we believe will place value on our distinct value proposition, which entails structuring capital solutions which enable them to maximize business growth and create positive social impact while retaining significant ownership interest,” he said. “Additionally, we are targeting at least 50% of portfolio investments toward ethnically diverse and women-owned and/or led companies. Historically, these companies have been undercapitalized and under-advised.”
Hoye most recently served as director and senior credit officer in the global corporate and investment banking group at Bank of America Merrill Lynchh.He has more than 30 years of financial services experience that spans credit risk, banking and investment management, including having spent 20 years providing credit solutions to middle-market companies.
Thomas and Hoye hope to capitalize on the growth of diverse and women-owned businesses while also taking steps to help close the wealth gap.
“We see a need in the market for more bespoke financing services tailored to the needs of private companies,” Hoye said. “There is also both a need and opportunity to provide greater access to capital for women and ethnically diverse business operators, which is core to our mission. We believe that full inclusion provides the greatest long-term value for investors, portfolio companies and the communities we serve.”
Written by: Source link