HCI Equity Partners
TOP 50 PE Winner
2021 | 2022 | 2023
Primary Address
1730 Pennsylvania Ave NW, Suite 525, Washington, DC 20006
Website
www.hciequity.com
Phone Number
202-312-5314
Which best describes the firm?
Traditional | LP Funded
Firm Inception
2003
Leadership
Doug McCormick – Managing Partner
Dan Dickinson – Managing Partner
Scott Gibaratz – Partner
Team Members
24
Firm Overview
Given our “business partner first” mentality, HCI Equity Partners typically serves as first institutional capital to family-owned companies with strong management teams, attractive business models, serving large, fragmented markets within the manufacturing, industrial service and distribution sectors in North America. HCI’s latest committed capital fund, HCI V (raised in late 2017), is $405 million. HCI invests $15-75 million per platform. For a new platform, we target companies with EBITDA of at least $3 million and hope to support their growth to more than $20 million through organic initiatives and complementary add-on acquisitions during our hold period. We aim to build not only bigger businesses, but better businesses through prudent integration and investment in key capabilities —people, process, technology, and capacity—to support growth well beyond each company’s current state.
Why do prospects want to do business with the firm?
HCI conducts anonymous 360 feedback surveys of our portfolio company senior managers to learn how we can better support our companies, soliciting general feedback as well as feedback on individual HCI team members. We asked a variety of questions about HCI support/engagement level, how HCI could better support them, and their views on HCI deal team strengths and weaknesses. We also asked how likely they were to recommend HCI to a friend or colleague who is looking to sell their business. Our resulting net promoter score on a scale of 1 to 10 from this question was a 9.68 (average) and 10 (median). Reasons for the score included the following responses:
1. “Overall, HCI provides an excellent support framework for growing companies and is continuing to improve. All HCI resources are focused on bettering the business and that’s clear in all interactions with them.”
2. “I have felt supported and feel like they try to generally treat issues with a fairness that benefits both parties and not just HCI. I feel their willingness to listen and change as needed would really help any business looking to sell.”
3. “I have found the HCI team to be extremely knowledgeable and forthright in our dealings. They have been there for strategy discussions and problem solving, yet leave us to run our business. We have heard horror stories of other PE firms digging too deep and causing the operating teams to jump ship.”
4. “HCI does a good job of balancing personal and professional interaction. They are very professional while still being able to maintain a good personal connection with the team.”
5. “Intellectually curious and as humble as they come.”
6. “What differentiates is relationships, execution and support. I have agreed with most but not every decision, but discussion was held to understand HCI’s perspective, not a mandate issued. Down to earth and lack the typical pretentiousness of other PE firms. Sincerely interested in the success of the business, not just IRR. HCI is a well-oiled transaction machine, so no surprises and few post deal issues, excellent execution skills.”
7. “We have accomplished more since closing the deal than any equivalent period. Really moving the company forward.”
Why do intermediaries present opportunities and want to conduct transactions with the firm?
HCI also conducted an anonymous survey of our top intermediaries to gather feedback and received ~50 responses. We asked a variety of questions about how HCI was to work with in a sale process and compared to our competitors. On a scale of 1 to 10 (10 being the highest), the average score was an 8 with respect to how knowledgeable the HCI team was, how easy we are to work with and how responsive we are compared to our peers. What “comes to mind” about HCI solicited the following responses:
1. “Well rounded individuals and good cultural fit with many clients.”
2. “Fantastic to work with, very little pain points in the diligence process and look forward to showing you more deals in the future.”
3. “Overall having done 50+ transactions involving PE funds you rank at the very top in terms of overall deal experience.”
4. “HCI knows its niche and executes against its areas of differentiation. HCI does not try to be what it’s not, but it excels at doing what it does well.”
5. “People always like to deal with people they like and trust, and that is why people like to work with HCI.”
6. “I enjoy the marketing emails about the portfolio—very helpful. Also enjoy working with the HCI team—very knowledgeable, responsive and a pleasure to work with.” It’s our goal through these surveys to learn how to communicate with perspective partners, investors and intermediaries and to make better decisions with data and research.
Contact
1730 Pennsylvania Ave NW, Suite 525, Washington, DC 20006
Call 202-312-5314 | Visit www.hciequity.com