Industry First

Industry First is the proprietary, research-based process through which the Falfurrias team identifies attractive growth markets and partners with talented industry executives to build growth businesses.

Industry First starts with the development of a thesis identifying growth markets with durable trends and in which incremental value creation may be created through Falfurrias resources. In most cases, a senior executive with a proven industry track record is retained to assist in developing this thesis and identifying investment opportunities.

Once completed, Falfurrias publishes its thesis to investment bankers, service providers, and target businesses in an effort to identify targets that will benefit from the distinctive advantages delivered through a Falfurrias partnership.

When a matching opportunity arises, the Industry First thesis becomes a significant part of due diligence and an integral component in the company's strategic planning and tactical execution during the Falfurrias investment period.

Packaged Food
Durable Growth Trend: Shifting Consumer Preferences
Completed Acquisition: Sauer Brands, Inc.
  • Falfurrias Capital partnered with Bill Lovette to research packaged food brands that are well-positioned to capitalize on the shifts in consumer preferences identified through our campaign.
  • Falfurrias Capital and Mr. Lovette identified Sauer Brands as a platform investment opportunity in the packaged food space due to its diverse portfolio of authentic brands that have significant growth potential.
  • In August, 2019, Falfurrias announced an investment in Sauer Brands, Inc. and Bill Lovette joined the company as the Executive Chairman and interim CEO of the business.
Bill Lovette

Bill Lovette has more than 35 years of experience in the packaged food industry. Prior to his current role as interim CEO of Sauer Brands, Mr. Lovette was the CEO of Pilgrim's Pride (NASDAQ: PPC) where he led a corporate transformation that lifted the company out of bankruptcy. Mr. Lovette has advised FCP throughout our packaged food campaign and was immediately appointed interim CEO of Sauer Brands, Inc. following FCP's investment in the business in August, 2019.

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Technology-Enabled Services for Financial Institutions
Durable Growth Trend: Technology, data, and services to better enable financial institution management
Completed Acquisition: Marquis Software Solutions, Inc.
  • Working alongside Susan Faulkner, Falfurrias recognized the growing need for technology tools that could identify and enable additional revenue opportunities for financial institutions (FIs), and in particular, incremental revenue opportunities for small and medium size banks and credit unions that lacked the resources to build such tools in-house.
  • Falfurrias Capital and Ms. Faulkner identified Marquis as a platform investment opportunity that provided software and services to FIs enabling actionable intelligence that can drive revenue growth.
  • In September, 2016, Falfurrias announced a majority investment stake in Marquis and Ms. Faulkner joined the company as CEO of the business.
Susan Faulkner

Susan Faulkner has over 30 years experience in the financial services industry and expertise across bank strategy and operations as a former executive with Bank of America. Ms. Faulkner led FCP's tech-enabled services for financial institutions industry first campaign and was immediately appointed CEO of Marquis Software Solutions upon the firm's investment in the business in September, 2016.

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Vertically Focused Marketing, Media, and Information Services
Durable Growth Trend: Domain specific marketing tools, content/thought leadership and related services
Completed Acquisitions: GlynnDevins and Industry Dive
  • After a successful 3.5-year investment in GlynnDevins, a leading provider of senior living marketing services, Falfurrias continued to evaluate opportunities to invest in vertically focused marketing service providers.
  • Falfurrias Capital identified Alexander Jutkowitz, a leading evangelist for the shift in Business to Business (B2B) marketing and communications toward integrated professional content, engagement and strategy. Mr. Jutkowitz partnered with FCP as an Industry First executive to identify companies taking advantage of this shift.
  • In September 2019, Falfurrias announced an investment in Industry Dive and Alexander Jutkowitz joined the company as Executive Chairman.
Alexander Jutkowitz

Alexander Jutkowitz is one of today's leading evangelists for the shift in marketing and communications toward integrated content and strategy. His work for clients in a wide array of fields proves that brands who tell their own stories innovate faster and inspire enduring customer loyalty. Mr. Jutkowitz has more than 20 years of experience in strategic communications—as a political pollster, digital architect, brand strategist, and content creator in over 30 countries. He is an adjunct professor at USC Annenberg and member of the Curriculum Committee. Mr. Jutkowitz's book, The Strategic Storyteller, was published by Wiley in 2017. Alexander was raised in Chile and Philadelphia and is fluent in Spanish. Mr. Jutkowitz partnered with Falfurrias Capital to identify vertically focused marketing firms positioned with high quality content, peer to peer platforms, and tech enabled services.

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Other Representative Campaigns

Electric Utility Supply Chain (Active Campaign)

Durable Growth Trend: Aging utility infrastructure, trend toward outsourcing, and increased regulatory scrutiny
Completed Acquisitions: UC Synergetic and North American T&D Group

Providers of differentiated products, services, and software to electric utilities can create substantial barriers to entry in their markets through brand equity, reputation, and institutional knowledge that create "sticky" customer relationships. These constituents in the electric utility supply chain are often used to replace a rapidly-aging utility workforce and/or to extend the life-cycle of valuable mission-critical assets. Many of these companies also offer the industry a more efficient "one to many" model for servicing assets by leveraging infrastructure, capabilities, automation, technology, or resources over multiple utility customers. Outsourced service providers have become an increasingly important component of the electric utility ecosystem over the last several decades as utilities struggle to replace an aging workforce in an economy that is producing fewer engineering and technical workers. Falfurrias Capital has substantial experience in these markets having successfully grown and exited UC Synergetic and North American T&D Group.

Cybersecurity Services (Active Campaign)

Durable Growth Trend: Commercial spend on cybersecurity-related services

Despite growing awareness and investment in defensive capabilities to address cybersecurity risk, the number of breaches and the costs associated with them continue to increase. Many businesses – particularly in heavily-regulated industries that maintain or utilize sensitive information – are relying on a federation of third-party services and tools to confront this dynamic threat, but those solutions may not address industry-specific requirements or infrastructure. We believe cybersecurity service companies with a service offering that is tailored to specific industries will be the beneficiaries of growing demand for their capabilities.

Packaged Foods (Active Campaign)

Durable Growth Trend: Shifting consumer preferences
Completed Acquisition: Sauer Brands, Inc.

An increased focus on health and wellness, shifts in food purchasing patterns by millennials, and the proliferation of specialty diets are creating opportunities for niche packaged food brands to take market share from industry leaders. At the same time, many national brands suffer from underinvestment in marketing and supply chain management. Through a formalized partnership with a national food brokerage, Falfurrias believes we can leverage proprietary data analytics to identify high-potential regional niche brands as well as "orphaned" national brands embedded in larger consumer product companies, and help grow these brands through strategic investment. Falfurrias is partnering on the Packaged Foods campaign with Bill Lovette, a consumer packaged goods industry veteran, who is currently the interim CEO at Sauer Brands, Inc. and has prior experience at Pilgrim's Pride (NASDAQ: PPC) and Tyson Foods (NYSE: TSN).

Asset-Liability Management Software & Services (Active Campaign)

Durable Growth Trend: Technology, data, and services to better enable financial institution management

As a result of historically low interest rates in the last decade, many banks no longer possess or resource robust asset-liability management (ALM) capabilities. ALM refers to the practice of managing interest rate risk, which insures that the expected interest margin is greater than the forecasted liabilities, including the cost of deposits. ALM capabilities are fundamental to how banks and credit unions preserve capital and generate earnings, but effective interest rate risk management is enormously complex. Due to this complexity and in anticipation of rising interest rates in the next decade, most institutions are expected to increasingly rely on third-party consultants or software to support an active ALM program that also fulfills the expectations of regulators.

Visitor and Vendor Management Platform

Durable Growth Trend: Safety and contingent workforce

Companies and institutions across virtually all end markets increasingly need to pre-qualify, screen and monitor incoming populations driven by regulatory pressure, safety concerns or cost efficiencies. Furthermore, as the U.S. economy increases its reliance on contingent workforces, companies will need to address a growing population that is currently under-monitored but requires the same screening processes as employees. We believe there is an attractive opportunity amid a fragmented universe of vertically-focused vendors today to build a multi-vertical visitor and vendor management platform. We believe the benefits of such a platform would include increased scale, diversification, greater "network effect" among visitors & vendors, and a wealth of data that could lead to value beyond existing service offerings.

Hard Skills Training and Education

Durable Growth Trend: Increasing regulation and online adoption
Completed Acquisition: American Safety Council

Corporations and consumers are increasingly turning to online providers to meet their education and training objectives, especially in markets that are driven by regulations or government oversight. Falfurrias has identified the potential to build a diversified provider of e-learning solutions for regulatory-driven end markets that could accelerate growth through acquisition, investments in technology, and leveraging sales & marketing infrastructure. In 2014, we acquired American Safety Council, an e-learning provider for driver safety and workplace safety.

Pet Services

Durable Growth Trend: Humanization of pets and national pet ownership

The U.S. pet industry is the seventh largest retail industry in the U.S. that has grown 5% since 2006. The industry continues to exhibit macro tailwinds as pet ownership continues to grow and owners increasingly "humanize" their pets and treat pet product and service spending as nondiscretionary. Falfurrias believes there are significant opportunities for veterinarian outsourced services with an emphasis on financial services – pet insurance, wellness plans and alternative consumer finance plans.

Healthcare Revenue Cycle Management

Durable Growth Trend: Shifting payer mix and increasing provider sophistication

The healthcare industry in the US has undergone significant transformation as a result of changing regulations with the Affordable Care Act. This includes a transitioning coding system and increasing pressures to improve patient services while simultaneously lowering costs. In general, healthcare providers are not well-equipped to manage their revenue cycles internally, and they have experienced lower rates of collection and further expense pressures accordingly. Such market dynamics are leading to increased utilization of outsourced RCM providers to improve cash flow, increase productivity / efficiency, and ensure accurate reimbursement through a higher degree of specialization and expertise.

Healthy, Fast Casual Restaurants

Durable Growth Trend: Shifting consumer preferences

FCP believes that there is a growing demand for fast casual restaurants serving consumers wanting healthier (both real or perceived) products. Consumer preferences are changing in favor of healthy food, eating out, and dining quickly. Such market dynamics make opportunities in the space attractive on their own, and combined with the firm's Bojangles' experience, Falfurrias believes it can to add value to healthy, convenient restaurants.

Multi-Concept Franchise Home Services and Home Care

Durable Growth Trend: Senior population and care trends

FCP believes an opportunity exists to build and grow a diversified multi-concept franchise in the home health and home care space. A full continuum of care offers skilled patients ability to progress into unskilled or move into hospice with the ease of one provider while capturing the full revenue stream. In addition, increasing complexity of regulations allows franchise platforms of scale to truly differentiate themselves by offering value-added resources to franchisees and through superior execution.

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