Enhanced Capital/Summit Acquisitions Group
A single buy-side mandate posted by Enhanced Capital on Intralinks DealnexusTM led to a $5 million subordinated debt deal, introduced by Summit Acquisitions Group.
"Glick, for his part, feels that the buy-side mandate he created offered tremendous payback. A few minutes to post the mandate on Intralinks Dealnexus and, within a few hours, dozens of advisors contacted him.
"A handful of inquiries led to conversations, and my conversation with Tom led to a deal. That is a fantastic payback for my time.""
— Jonah Glick, Vice President, Enhanced Capital
On both the buy-side and the sell-side, Enhanced Capital and Summit Acquisitions Group needed a faster and more efficient way to identify and close deals.
Enhanced Capital, headquartered in New York City, is a diversified private investment firm focused on established small and mid-sized companies overlooked by traditional sources of capital. Jonah Glick is vice president with Enhanced Capital’s $225 million subordinated debt fund.
Glick was searching for new ways to identify potential deals. "Finding proprietary deal flow is an on-going challenge, especially in identifying smaller sell-side firms with more selected and specialized opportunities," explained Glick.
At the same time, Tom MacPherson, Principal at Summit Acquisitions Group, was having similar problems identifying potential sources of alternative financing for his clients. Summit is one of the leading M&A firms in the Southeast United States, headquartered in Atlanta, with an office in Charlotte, NC. Summit has a 15-year history of representing clients in the sale and purchase of privately held businesses, valued between $750,000 and $20 million.
"The explosion of private equity groups in the last ten years has been considerable, so keeping track of all them has been impossible," said MacPherson. "One year a firm would be interested in aerospace investments, but the next year they wouldn’t be. So I would waste my time, or miss possible opportunities, without having a source of up-to- date investment criteria for all the funds."
Both Glick and MacPherson discovered Intralinks Dealnexus as an online source of deal partners. "There were a lot of new people to meet that I would not have had exposure to otherwise," Glick said of his first encounter with Intralinks Dealnexus. He started reaching out to people. Glick also spent a few minutes setting up a buy-side mandate for Enhanced Capital, a more passive approach for a private equity firm to attract high-quality, proprietary deal flow. That was on August 14th.
MacPherson had also been exploring Intralinks Dealnexus. He had recently been engaged by Hometown Oxygen to secure financing. He saw Enhanced Capital’s buy-side mandate just one day later on August 15th and immediately reached out to Glick to introduce Hometown Oxygen. "I hadn’t even put the deal on Intralinks Dealnexus myself, because the marketing materials were not quite ready, but I could tell immediately that Hometown Oxygen was a good fit for Enhanced Capital."
That kicked off a month of due diligence, followed by a negotiation of terms. The transaction closed in mid-December, a timeframe that was to be expected since this was Hometown Oxygen’s first use of subordinated debt.
Glick, for his part, feels that the buy-side mandate he created offered tremendous payback. A few minutes to post the mandate on Intralinks Dealnexus and, within a few hours, dozens of advisors contacted him. "A handful of inquiries led to conversations, and my conversation with Tom led to a deal. That is a fantastic payback for my time."
Glick continues to rely on Intralinks Dealnexus to extend his outreach. "It just makes my time more efficient. As an investment professional in a small team, one of my most valued assets is my time, so anything that allows me to save time is extremely valuable."
Beyond saving time, Glick sees that Intralinks Dealnexus is providing him with opportunities he might otherwise never know about. “It’s hard to find targeted, smaller firms like Summit Acquisitions, and they often have great deal flow that ordinarily I would not have access to. Using the Intralinks Dealnexus platform gives me access to these smaller firms and ultimately produces what is closer to proprietary deal flow.”
Hometown Oxygen continues to grow and remains a portfolio company for Enhanced Capital. Glick is thankful for the introduction from MacPherson and Summit Acquisitions Group, and the two keep in touch about potential opportunities.
MacPherson also sees Intralinks Dealnexus as an important part of his business. "The world doesn’t beat a path to your door, so you have to just get out there and throw a lot of lines in the water. Intralinks Dealnexus covers a lot of space that I can’t cover myself, so I get more people seeing my deals with a greater chance of someone wanting to buy it sooner."
"By using the resources of Intralinks Dealnexus, I get more people seeing my deals with a greater chance of someone wanting to buy it sooner."
— Tom MacPherson, Principal, Summit Acquisitions