1) People spend their careers trying to get into big, reputable firms such as your old firm
I joined Silver Lake from industry, where’d I’d spent 25 years as a consultant and an operator in PwC Consulting and then IBM after they bought us. So, while I joined them as a managing director, I wasn’t on your typical investment banking or private equity career path. I joined them to define and build their value creation team, which is similar to the operating partner groups with other large PE groups. I was completely thrilled to join them, but I didn’t look at this as a pinnacle the same way as other people did. In the last year or so, I became convinced that I needed to engage in something either back in operations or in PE, but in a place where I would not be so specialized as at Silver Lake. Philadelphia was also a huge element of the decision-making process. To be based in your own hometown is something I’ve never been able to do for the last 20 years.
2) How is it different working for a much smaller fund compared to a $9.3 billion fund?
At Silver Lake there are partners and managing directors who drive deals, and then there are senior guys like myself that drive portfolio value creation. The opportunity in this end of the marketplace is to be a bit of a hybrid, where I am part of the investment committee, and I’m a senior partner in the firm, and I’ll be more involved in the deal process, of course with a clear focus on portfolio company operations.
3) At Silver Lake you dealt mostly with technology companies. How will that change with Milestone?
The reality is that while I had a good background in tech before I joined Silver Lake, I also spent a lot of time in my early consulting career in manufacturing, consumer goods, retail, distribution, and pharmaceuticals. Milestone is not industry focused, so it’s cool to get back into looking at businesses that operate in spaces other than just tech.
4) Where is Milestone seeing the most opportunity right now?
We’re seeing deals all across the spectrum. Mostly in un-sexy spaces like infrastructure-type businesses, basic manufacturing spaces. We’ve also seen some things in specialty pharma and in retail consumer products. We’re lower middle market, and relatively industry agnostic. We’re more valuation-focused.
5) How many deals does the firm expect to close this year?
Our expectation is that if we can get three or four deals done in this net 12-month period that would be a very good year for us. On the exit side, we have a couple of our companies we believe we’re in a position to exit and there’s activity underway to make that happen, and we believe there are one or two others we may be able to put into that mode in 2011.
Edited for clarity