By Gregg Archibald
Growth takes investment. For some companies in our industry, that investment is much too hard to come by – especially for those companies that aren’t either very large or tech driven. Growth Calculus is looking at the market a bit differently, with a focus on more traditional measures of opportunity – growth, service, product, profitability and potential.
In my role with Gen2 Advisors, I see many small and medium sized companies that are doing excellent work but struggling to find the knowledge and capital it takes to grow. We are pleased to see this fund filling a void in the market by supporting these suppliers.
We think the press release below from Growth Calculus explains their focus and underlines why this effort is important better than we can, so we are posting it in it’s entirety. We hope the entire research supplier community will find this as exciting as we do!
Please note that Gen2 Advisors is supporting Growth Calculus in their effort to identify companies that are appropriate for this fund.
Growth Calculus, the growth capital investment and advisory firm, today announced the launch of its inaugural investment fund — the Service Evolution Fund — a sector-specific fund targeted for investment in specialized marketing services companies in the US and Canada.
The Fund seeks to invest in marketing services firms with a track record of revenue growth and profit earned by providing highly specialized expertise to Global 2000 companies across all industry sectors. It is currently evaluating investment opportunities in categories including:
- Customer experience consulting and analytics
- Vertical & application-specific research and data/reporting
- Marketing optimization consulting and analytics
- Forecasting and behavioral economics
- Social media data collection and analysis
- Marketing operations outsource management
- Mobile marketing data/analytics and app development
- Advertising production and talent cost management
- Agency compensation and media auditing
- Lead generation and sales effectiveness
- CRM and customer loyalty consulting and analysis
“These are the types of highly specialized services companies that have terrific, un-tapped knowledge assets,” said Patrick LaPointe, managing partner of Growth Calculus. “But they need both capital and an infusion of very senior expertise in key areas to find their breakout growth paths.”
“We believe that marketing services companies are under-served by traditional venture and private equity investors,” said Kathy Bachmann, managing partner of Growth Calculus. “By uniquely combining growth capital of $1 million to $3 million along with intensive expert advisory support in areas like product development, sales operations, marketing demand generation and backroom process efficiency, we believe we can help create higher levels of performance and open doors to new solutions and new markets.”
“This new fund targets a segment of the market that is underserved with a combination of capital and counsel that can accelerate emerging marketing services companies’ growth,” said company advisor Tony Pace, former CMO of Subway restaurants and chairman of the Association of National Advertisers. “Changes in consumer behavior and technological advancement have given rise to many new enterprises in this space. Having worked with many good ones, the desire among them for expert counsel and investment capital to spur growth is nearly universal.”
“Having built, grown, and ultimately sold several companies that all started out in services and transformed into data- and tech-leveraged offerings, I’ve seen how great service firms can create substantial value for their owners, teams, and investors alike,” said LaPointe. “The key lies in learning to ‘productize’ to create more value for clients and greater operating efficiencies. When that happens, revenue and profit growth rates can easily match those of the best software companies and company valuations improve dramatically.”
“Studies in the angel capital universe show conclusively that investors who earn the best returns are those who are highly focused in their selection process, exercise discipline in valuing and vetting each opportunity, and then roll up their sleeves and work with the CEOs of their portfolio companies to help make growth happen,” said Bill Payne, Angel Capital Association’s 2009 angel investor of the year (Hans Severiens Award) and Growth Calculus advisor.
“We also see great opportunities to invest in women-owned businesses,” Bachmann said. “These are substantially under-represented in the venture and angel investment communities today, yet which tend to deliver above-average growth, profitability, and efficiency. That’s why we’ve committed to invest at least 50% of our capital in women-owned marketing services businesses.”
For more information, visit www.growthcalculus.com.
This press release is not a solicitation to invest in the Fund. Investment is only open to Accredited Investors and only after review of the Fund’s Private Placement Memorandum, Limited Partnership Agreement, and Subscription Agreement.