MP Pryor Smartt

EXECUTIVES in Nashville private-equity firm Lead Capital Partners reported to the SEC yesterday on a prospective $125MM raise, showing north of $61.4MM raised and 41 investors aboard at filing.

A year ago, issuer LCP II Holdings said in its initial filing it had attracted nearly $44.8MM, to that point.

In 2011, Lead Capital Partners was registered in Delaware and Tennessee by Managing Partner Pryor Smartt. The LCP team is here.

Prior to forming Lead Capital, Co-founder Smartt had been a director of investments within Harbert Management Corporation.

Still earlier, he held Associate roles with KeyBanc Capital Markets and with SunTrust. Smart earned his economics degree at Vanderbilt University ('95).

Lead's website says the team aims to acquire majority interest in healthcare companies with EBITDA of $1MM to $7MM, and believes its model represents "an attractive alternative to traditional private equity by establishing partnerships focused on aligning all constituents for long-term success."

The firm's investment priorities are weighted toward healthcare, dental care, healthcare IT and health-provider platforms. Portfolio here.

VNC research indicates Lead Capital has completed eight platform acquisitions, including bolt-on buys, and has exited four companies, three of which transactions were 100% exits.

Its full exits included its first and last bet thus far outside the healthcare lane: a New Jersey business focused on lifeguard staffing for swimming facilities.

In 2022, Lead Capital announced exiting ApolloLIMS, a provider of a laboratory information management system, via a deal with UK-based CliniSys.

Lead Capital's website describes the U.S. Healthcare sector as "generally inelastic and represents approximately 20% of the U.S. economy. Yet, the industry remains highly fragmented, inefficient, and generally frustrating for all constituents. Lead partners with innovative companies focused on improving the patient and provider experience, delivering better outcomes and reducing costs."

Explaining its view of its business, the firm says, "Lead's investors commit capital and invest directly in each portfolio company rather than via a traditional fund structure. This unique structure allows Lead to focus on driving value at each individual company and not the relative performance of other portfolio companies. We are not constrained by the buy-and-sell timelines dictated by typical fund documents."

It adds that management "believes investors are best served by compounding returns in existing investments where fees are minimized, taxes are deferred, and capital remains invested with trusted management. We offer a unique model relative to traditional private equity that provides immediate cash yield on called capital, a lower, performance-based fee structure, flexibility on hold periods, and a more tax-efficient platform. Our differentiated structure also provides better alignment between management, employees, investors, and Lead's investment team. We believe Lead's structure and strategy ultimately lead to far more attractive risk-adjusted returns for our investors."

This story will be updated, as warranted. VNC

. last edited 1712 12 December 2024