This is not your average investment bank. Whereas most investment banks offer only a team of investment bankers, The Capital Corporation combines its seasoned investment banking team with a broad roster of full-time cyber security, digital marketing, software engineer, insurance, financial, infrastructure, human resource, and call center employees.
Building an extensive support team has been a strategic initiative for The Capital Corporation, a locally owned lower-middle-market investment banking firm which was founded in 1991 by Dan Adams, President and CEO. The Capital Corporation’s team of professionals work to ensure its clients come away as winners, according to Devin Green, Chief Operating Officer.
With more than two dozen full-time specialists working behind the scenes, Green spotlights The Capital Corporation’s unique ability to serve as a “solutions provider” for its clients. This translates to taking steps beyond the industry norms to better position each of its clients to capture millions of dollars more in value when they sell their business.
“By doing what we do and based on how we do it, we are uniquely positioned to really make a material difference in the lives of business owners…” – Devin Green, Chief Operating Officer
“What empowers us to be that solutions provider is the ‘mother ship’ resources we have in-house,” Green explains. “What other investment banks do, when they aren’t fortunate enough to have those resources, is ask a lot of questions and request a lot of information from the client. Then those investment banks will essentially take that feedback and package it into its client’s marketing materials for potential buyers. What they’re doing really is just repackaging feedback from their clients, which serves a purpose, but they are not providing the type of solutions our team does that really stretches a company’s valuation.”
Once a company engages The Capital Corporation to help them sell their business, early on in the process, Green and his team will create an in-depth SWOT analysis (strengths, weaknesses, opportunities and threats) that is custom built for each client and a byproduct of about 60-90 days of diligence and analyses.
“Out of that SWOT analysis, we will create what we call a Pre-Mortem Analysis, where we extract each weakness and threat within our client’s business that are not aligned with those investment criteria that buyers indicated they will pay a premium for,” Green says. “For each weakness and threat, we will identify detailed solutions to mitigate them before we go to market with buyers. It is at this point in the process where we insert our specialists into the game. We not only identify the solutions, but we are able to execute them on behalf of our client.”
That deep dive into market conditions on the front end, combined with the SWOT analysis leading to a Pre-Mortem Analysis, allows the full team at The Capital Corporation to swing into action to strengthen the client’s market value. Green mentioned “A few examples of the types of solutions our specialists help implement are: i.) the design and execution of sophisticated digital marketing campaigns ii.) detailed audits of a company’s technology stack and where scalability bottlenecks exist iii.) executive compensation designs to ensure the retention of key employees through a transaction iv.) software algorithms used to run a variety of complex analytics v.) the architecture of dynamic operating dashboards to ensure quality control, and many others. It’s really exciting, because we customize the solutions, based on what will drive the most value in each of our client’s businesses.”
“What we’ve found is that there are not a lot of investment banks that can offer the combination of Wall Street-caliber professionals with these robust solutions to the lower-middle market companies that we serve. By doing what we do and based on how we do it, we are uniquely positioned to really make a material difference in the lives of business owners, their families, and their employees….and that is what energizes our team,” Green says.
The Capital Corporation’s specialists are impressive in their own right, but the firm’s actual investment bankers also stand out from the crowd, with the five senior investment bankers being able to leverage more than 120 years of experience among them.
Through their combined efforts, these various team members work together to strengthen a business’s overall appeal to buyers, a process Green likens to armoring a client.
“We’ll put together solutions to either completely eliminate those chinks in the armor or sometimes mitigate them enough so that we can sell through the chinks,” he says.
By providing those solutions, The Capital Corporation can drive up valuations of a business during the sales process.
“We generally keep this specific statistic confidential (and only tend to share it with our clients), but we’re seeing a significant increase in valuations (between the first and second) bids of our process,” Green says. “And a lot of this incremental value is driven by these kinds of solutions that we are able to provide when leveraging our mother ship’s resources.”