How to Build an Indy Sponsor Team Before Chasing Deals
Where many newly established independent sponsors "fake it 'till they make it", Shreveport-native Edward Crawford used his "Mission & Margin" principles to raise working capital for real infrastructure and a team at Coltala Holdings before chasing deals.
Edward Crawford is an Afghanistan veteran, Goldman Sachs alumnus, serial entrepreneur & Texas Governor appointee. With Coltala Holdings, they have closed a series of Texas-based deals in home services, healthcare, aerospace, and other essential services.
Edward has a background in real estate. He laments the lack of a 1031 exchange for private equity assets, and advocates for sponsor fees that resemble those in the real estate sector. He is furthermore a proponent for long-term holdings, saying you can (dividend) recap a great business as often as you want, but you can only sell it once.
We’re a holding company in a private equity skin.
Inspired by Danaher and Toyota, Edward and his team have developed Coltala Enterprise Systems (CES). With CES, they identify core KPIs and determine at the beginning of an investment lifecycle where they need the KPIs to get to in order for the target company to become a stand-out performer in its vertical.
What are the main 8 core operating metrics that really matter in this business. And we layer on about 7 more that are for the industry to get to about 15. And we work with investment banks and the people that really know the industry and say, “OK, seven years from now, we get to end of a rainbow, where we want to be, what's the perfect business in this space,” whether it's aerospace, home health, HVAC, whatever it may be, and what do these metrics look like?
Coltala uses Pipedrive as their CRM. Within it they track both deals and deal sources. Specifically, they maintain a list of their fifty top deal sources, and they tend to these relationships in a structured manner with regular catch-ups and in-person time investments.
This newsletter has nowhere near the reach of Coltala’s, where the recipient list counts 30,000 stakeholders, including business owners, investment bankers, and prospective investors. According to Edward, their monthly newsletter blasts typically generate 14-15 active leads.
Edward is a thoughtful, resourceful, and strategic independent sponsor. Listen for his take on how to build a professionalized investment group from scratch and beyond.
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