(Left to right) Doug Lepisto and Derrick McIver
KALAMAZOO, Mich.—Sleeping Giant Capital, a private investment firm with ties to Western Michigan University's Haworth College of Business, announced it has launched a $50 million investment fund to generate economic, social and educational returns in West Michigan by acquiring small businesses.
The fund seeks to take equity positions in companies with $1.5 million to $10 million in revenue and transition a new owner-operator into leadership of the company.
Managed by Drs. Derrick McIver and Doug Lepisto, co-directors of the Center for Principled Leadership and Business Strategy at the Haworth College of Business, the fund will pursue at least two acquisitions per year, with 80% of acquisitions located within West Michigan.
The critical issue the fund addresses is that the transition of ownership requires a pipeline of talented future owner-operators. To solve this, the Center for Principled Leadership and Business Strategy will soon announce a training program that is open to MBA students as well as experienced professionals. This innovative, interactive, digitally enhanced program trains aspiring owner-operators on sourcing, analyzing, acquiring and leading small businesses.
Graduates of this training program will then be eligible to apply for a competitive process where aspiring owner-operators would be personally mentored by executives and backed by capital to source and acquire a company.
Sleeping Giant Capital was designed to create a "big win" across various stakeholders including West Michigan businesses, investors, aspiring owner-operators and the Haworth College of Business.
According to McIver, a record number of baby boomers are looking to retire and transition the ownership of their businesses, but they lack a clear successor. This creates a dilemma for business owners but also an opportunity.
"When owners lack a successor, their legacy and jobs are at risk, and there is risk the business will be acquired by those outside the local community," he says. "Owners want someone they can trust that lives in the same community. With this fund and training program, we wanted to create a mechanism to generate investment returns and ensure business ownership stays with those who want to create economic prosperity and be good stewards within their community."
Not only will local businesses and investors benefit from economic returns, but the fund makes the possibility of business ownership a reality for experienced professionals.
"These initiatives create life-changing opportunities for West Michigan business professionals," says Lepisto. "We want to show them that there is an attractive, meaningful and viable third career path that is different from climbing a corporate ladder or starting a new company. They can buy a company. With the right training, support and capital, we can create the next generation of business owners."
A portion of the profits from acquired companies will be distributed by Sleeping Giant Capital back to the Haworth College of Business to maintain and expand the impact of the Center for Principled Leadership and Business Strategy.
"The partnership with Sleeping Giant Capital is a win-win for our community," says Dr. Satish Deshpande, dean of WMU's Haworth College of Business. "The opportunity to grow talent and expertise in the West Michigan business community is something that the college is deeply committed to. The acquisition training program and the ability for those who complete it to access capital will greatly enhance opportunities for MBA students, business professionals and those business owners looking to sell their companies to future owners who will lead in ways that honor their own financial and emotional investments."
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