Reposted with permission from Illinois Venture Capital Association (IVCA)
The membership of the Illinois Venture Capital Association keeps expanding with each new addition, connecting to the comprehensive roster of Venture Capital, Private Equity and the support industries. Members have opportunities in IVCA networking, lobbying support and participation in the development of new ideas and educational events within the association. The latest new member is Kinzie Capital Partners, which invests in lower middle market companies amidst transition in the consumer, manufacturing and services industries.
The following is a Q&A profile with Kinzie Capital Partners, which explores the firm’s background and their expectations for interacting with the IVCA.
New Member: Kinzie Capital Partners
Representative: Katie Li, Manager, Finance & Operations
IVCA: What is a brief history and background of the Kinzie Capital Partners?
Kinzie Capital Partners: We invest in lower middle market companies amidst transition with a focus on the consumer, manufactured products and business services industries. Whether a company is experiencing a generational shift, period of high growth or changes in business cycles, we seek opportunities to create lasting change in today’s disruptive environment by leveraging technology and a strong operational focus to eliminate inefficiencies and unlock new business opportunities.
Our principals have a long tenure of sourcing and executing complex transactions while implementing operational improvements. In addition, we have a unique strategic alliance with Clarity Partners, which specializes in management and technology consulting. In total, Kinzie has assembled an in-house team of technology, industry and operations experts that are readily available to assist with due diligence and work closely with our portfolio companies to execute our shared strategic vision.
IVCA: Why did the firm decide to join the Illinois Venture Capital Association?
Kinzie Capital Partners: We have spent almost two years establishing our firm and looking for new avenues to engage with our colleagues to support the industry. As active investors and residents of Illinois, joining the IVCA was a logical step for us to actively participate in the industry dialogue and take part in educating policy makers.
IVCA: The firm’s philosophy is recognizing future growth for investment in three specific types – consumer, manufacturing and service industries. What criteria does the firm use in its search for the ideal lower middle market company, and what characteristics of those companies best match your criteria?
Kinzie Capital Partners: We pursue established, US based companies with up to $15 million in EBITDA that are going through a transition due to founder, generational or cycle-driven challenges where we can bring a unique perspective and leverage our broad network of operating executives to provide strategic guidance through a variety of situations.
We are industry focused and cycle agnostic. We focus on industries that we understand and in which we have relationships and prior success. We seek companies where we see immediate value creation opportunities because they are valued by their customers and have a competitive advantage with real staying power.
IVCA: What has the firm learned about using technology to streamline the companies you invest in? What current technologies do you believe are being underutilized by those types of companies, and what improvements do you immediately see once you implement these technologies?
Kinzie Capital Partners: In general, we have seen that most companies with less than $250 million in revenue are not investing enough in technology. Typically, we see dated software, cumbersome systems or highly manual processes where technology is simply missing. Regardless of the diagnosis, the symptom is the same – data that is difficult to analyze and results that are impossible to interpret.
To name a few of our key learnings over the last few years based on our technology insights. One, a website is not a digital presence, and reports are not data analytics; Two, system implementation without integration leads to segregation of data; Three, underspending may be worse than overspending, but both can be avoided; and finally, we rarely meet a Chief Information Officer or someone who truly is dedicated to technology strategy.
There are thousands of ‘technologies’ out there that can service companies and improve efficiencies. The key to a successful technological upgrade is architecture and proper implementation which includes cultural buy-in. There is not one formula that works for every company as the industry and needs are different from one to the next.
IVCA: You have a tremendous commitment to philanthropic concerns within the community. How do those give-backs reap rewards within the culture of the firm?
Kinzie Capital Partners: Fundamentally, we believe that ‘to whom much is given, much is expected.’ Although talent and intelligence are equally distributed across humanity, opportunity is not. We also know that change requires commitment, creativity, and often an entrepreneurial drive. We encourage everyone at Kinzie to give back not only with Kinzie’s financial support, but with their time. Our philanthropy allows us to support organizations that are committed to creating lasting changes in our communities.
Fostering a culture of giving back to help others achieve their goals is an aspect of our corporate culture of which we are very proud as it permeates day to day with how we treat each other.
IVCA: What do Kinzie Capital Partners hope to achieve in their interaction with the VC/PC community within the IVCA?
Kinzie Capital Partners: We look to partner with our industry colleagues in shaping the narrative that influences state and national policy related to Venture Capital and Private Equity. As community members, we actively engage promote continued networking amongst individuals and organizations both deeply embedded, and on the periphery, of Venture Capital and Private Equity.
Original article found here.
