Craig Dupper: Partner Equity Model at Elan Growth
Craig Dupper of Elan Growth Partners champions partner equity over private equity, prioritizing high rollover equity and true partnerships in lower-middle market investing with proven results.
Elan Growth Partners is built on the principle of partner equity in lower-middle market investing. They commonly see sellers who roll ~40% of their ownership, which Craig views as both alignment and underwriting protection. The approach has produced strong outcomes, including a recent case study where Elan achieved a 3.21x net MOIC in ~3 years after professionalizing operations and reducing customer concentration in an aerospace & defense battery-pack manufacturer.
A key part of Elan's strategy is creating a back office that mirrors institutional private equity. The firm uses technology at the holdco level, including Juniper Square, to provide transparent reporting and centralized data management. PortCo CFOs handle operational reporting, which feeds into Elan's quarterly investor updates modeled after 10-Q reports. Board meetings run on a consistent cadence with agendas, milestone tracking, and forward planning.
Craig is adamant that allowing an investment to go to $0 is a failure. Destroying value, instead of creating it, signals weak underwriting or a lack of discipline. His view is that private equity should focus on proven, cash-flowing businesses, not untested or speculative ventures. Across his career he has seen holds as short as 19 months and as long as 20 years.
One nuance that Craig brings up is that every transaction in the deal-by-deal ecosystem benefits from a collective underwriting process that includes feedback from multiple LP committees. This wide scrutiny sharpens investment theses and surfaces risks early. LPs also value the flexibility of the deal-by-deal structure, allowing them to increase or decrease commitments as opportunities arise.
More recent episodes
To Exit or Not to Exit: 2x MOIC in 2 Years
Discover how Sarkaw Aziz acquired a vacation rental platform with creative financing and achieved a 41% IRR in just two years through strategic growth and timely exit.
The 3-5-7x MOIC Underwriting Framework
Princeton grad Rick Apple built Upside Growth Partners in Nashville, scaling 12 platforms while raising 5 kids. His strategic sourcing and 3-5-7 framework drive consistent success from retail to roofing.
A Portfolio Marked Up at 10x MOIC
Discover how Stenning Schueppert's radical alignment approach at Evolution Strategy Partners drives 10x returns in private equity, outperforming traditional fund models.