09 Mar Insights from Private Equity Firm Veteran Lamar Stanley of GCA
In last week’s Veteran Spotlight interview, we were joined by industry veteran Lamar Stanley. The webinar is accessible here. Stanley is a Director at Gen Cap America, which is a lower middle market private equity firm in Nashville, Tennessee. Since 1988, Gen Cap America (GCA) has made 60+ investments across seven committed private equity funds.
Before joining GCA, Stanley was with the Nashville based private-equity strategy group, Diversified Trust Company. A U.S. Navy veteran, Stanley holds a B.A. degree from The University of the South and an M.B.A. from The University of Chicago. Stanley is interested in the relationship between the M&A and private equity professions. During our webinar, Stanley explored how investment buyers operate in the lower middle market.
Over the decades, Stanley has amassed a consider amount of knowledge and expertise. He has a range of key advice that is directly applicable to business brokers and M&A advisors. For example, he feels that M&A professionals should work hard to ensure that all their clients work with an experienced, capable and reputable deal attorney.
Stanley feels that working with a deal attorney can make a tremendous amount of difference, as it can increase the chances of a successful transaction taking place. Deal attorneys understand the deal process, which can make all the difference when it comes to streamlining a deal.
Deal fatigue, wherein deals may drag on for months, can derail what would otherwise be a good deal. Working with an experienced deal attorney can help expedite the entire deal process. In turn, it can help to avoid the dangers typically associated with deal fatigue.
Stanley also provided some insight into how GCA operates. Some key takeaways are that GCA has an average hold time of roughly 6 to 7 years, which he points out is a little longer than private equity standards. He noted, “In 100% of our deals, we back an internal management team that is not currently the primary owner.”
Quite impressively, Stanley also stated, “Our real claim to fame is we’ve only lost money on one deal in our 30 plus year history…there’s not a tone of volatility around our process, ultimately we like to describe ourselves as transition capital…our model is stability above all else.”
In our next article, we’ll dive in and explore more of Stanley’s insights. Stanley discussed a series of key points that all M&A professionals should consider.