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Fresh profile: Carlson Private Capital’s ex-PE execs thrive on long-term view

  • Why this is important: More PE execs are moving to the family office world

Carlson Private Capital Partners is a unique creature in the private equity space.

“We would consider ourselves a direct investment platform that’s backed by a single family, so in a lot of ways that’s basically a family office,” CEO and Managing Partner Andrew Cantwell told Buyouts. “We’re essentially operating like a family office.”

The family in question is the Carlson family of Minnesota, whose wealth goes back to the 1930s, when patriarch Curt Carlson founded the Gold Bond Stamp Company, one of the first customer loyalty programs, on a $55 loan in 1938, according to Minnesota Public Radio.

Eventually, the company became corporate travel behemoth Carlson Wagonlit Travel.

The family also invested in Radisson Hotels and TGI Fridays, but divested from them in 2016 and 2013, respectively, using the money to set up Carlson Private Capital Partners, which was founded last year in Minneapolis.

Cantwell and much of the staff came from Norwest Equity Partners, another private equity firm based in Minneapolis. They mostly look to work with North American family or founder-owned businesses across a wide range of industries.

Carlson splits investments into three broad categories: consumer products — meaning health and wellness, fitness, food, and agriculture — industrial businesses, including packaging and containers, and services, including distribution.

Carlson’s sole mandate is to work as a GP, but Cantwell said the firm may from time to time “selectively co-invest” as an LP, but estimated greater than 70 percent of their work was as a GP.

Cantwell said Carlson is giving him and his partners a chance to take a more long-term, holistic approach to their work, focused on preserving the businesses.

He also said everyone at Carlson comes from family-owned businesses, and that perspective informs their work.

“We all intimately appreciate and understand what that’s like, and we think more multi-generationally, instead of three to five years ahead,” he said. “Frankly for all of us, that was kind of our frustration in the private equity world—that there was a lot of short-term thinking going on, where this platform allows us to really, truly focus on what’s best for the business.”

“The way that traditional private equity funds are structured, there’s an inherent conflict in some of the business models,” he added. “I think there’s more of a focus there on making sure you’re putting points on the board and having good success with your portfolio company so ultimately you can go out and raise the next pool of capital.”

An FO’s ability to work slowly and methodically makes a big difference. “I just think family offices are better positioned to address those inherent flaws around some of the timelines,” he said.