August 14, 2012
Private equity is an important driver of growth in the New York Metropolitan area, according to a recent Crain’s New York Business story. The article highlights the role that private equity plays in providing much needed growth capital and management expertise to companies in the tri-state area.
The piece identifies several success stories, including Stone Source, “a high-end supplier of marble and porcelain tile.” Operating in “a pretty illiquid market,” according to the company’s CEO Joe MacIsaac, Stone Source sought out private equity investment and has since grown from 60 to 130 employees and added warehouse locations in New Jersey, Chicago and Los Angeles.
After partnering with private equity in 2005, Women’s Marketing, Inc., a media buying and strategy firm located in Manhattan and Westport, CT, increased revenues by 12 percent between 2009 and 2011, and profits by 17 percent. CEO Bonnie Kintzer attributes the firm’s success to the combination of bringing experienced businesspeople on board and having better access to capital through their PE partners.
Despite recent media focus on the private equity industry as a result of the presidential election, Crain’s points out that common mischaracterizations of the industry don’t reflect the real role that private equity plays in the American economy. “[L]eaders of small and midsize companies such as [Steve Ehrlich, chief executive of private-equity backed firm Lightspeed,] describe a different reality,” the piece notes, “where private-equity investors can be a useful source of financing for well-established small businesses with revenue and a solid track record.”
Read the full story here.
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