Brexit, Isis and attracting entrepreneurs: Just some of the challenges faced by mid-market private equity firm Livingbridge

 
William Turvill
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Wol Kolade is managing partner of Livingbridge, which was founded as Isis in 1995

Private equity firm Livingbridge will likely be tied to its former name, Isis Equity Partners, for some time to come. In 2014, shortly before turning 20 years old, Isis chose to change its name in light of the rising prominence of its namesake terrorist organisation.

“It was kind of fine [prior to 2014],” says Wol Kolade, Livingbridge’s managing partner. “Only certain people said Isis, and it didn’t really turn until I think there was a press conference where Obama actually said, not Isil but Isis. And suddenly the US just went: ‘Isis.’ And from that moment on it became quite difficult. It was difficult because it became a conversation. I thought, well, I don’t want to talk about Isis as being the terrorist group.”

He adds: “Any publicity is great publicity. It was good publicity. But, let’s put it this way: there was an episode of Have I Got News For You which referenced us; there was a tiny snippet in South Park; the Huffington Post did ‘10 reasons why Isis changed their name.’ It went everywhere.

“Would I choose to have gone through it? No. But actually we’re through it and out the other end, and most people just call us Livingbridge.”

Read more: Four reasons why private equity is surviving the storm

Florence and the entrepreneur

To Kolade’s credit, he recognises why interest in the name change persists: not many other firms will have been through such an unusual corporate dilemma. But he would much rather talk about Livingbridge’s success and its role, as he sees it, “at the front of capitalism” aiding entrepreneurship, which he likens to pop music.

“I love pop music,” says Kolade. “Pop music’s great because they keep on recycling. You like a song, you listen to it, you like that song and you think: my goodness, at least I do, last year it was Florence and the Machine ‘How Big, How Blue, How Beautiful’: wonderful soaring voice, no one could write a better song.

“[And then] I hear another song four or five weeks later, and I go: that’s the best song ever.”

He adds: “And that for me is entrepreneurship. I don’t know what we’re going to be doing in five years’ time, but I know we will be doing something different. And actually if we do our job right as private equity, we’re right there helping those entrepreneurs to do better with their companies.”

Fat Face and more

One of the firm’s most high-profile successes was Fat Face, which increased its turnover six-fold to £60m and more than tripled its number of stores to 98 between 2000, when Livingbridge bought a minority stake, and 2005.

Livingbridge, which typically invests between £2m and £50m in businesses valued between £5m and £125m, has made 109 investments since it was founded in 1995. Current commitments include Crew Clothing, Vietnamese restaurant group Pho and, as of last month (FEBRUARY), family law firm Stowe.

“They’re all interesting in their own way,” Kolade says. “What a privilege to work in this area. If you like business, which I do, then it’s just an incredible privilege. I get to look and see what’s coming all the time. That’s my day job.

“And then I get to wander round a portfolio of 35 companies and management tell me about what they’re doing – great.”

Read more: Investors are preparing to inject more cash into private equity this year

Beating Brexit

Like many UK business leaders, Kolade had a bit of shock when he woke up on 24 June last year. As the UK voted for Brexit, Livingbridge was attempting raise hundreds of millions of pounds, primarily from US funds, to invest in small UK companies.

“It was not a fun day on the Friday, actually,” he says. “We were right in the middle of a fundraiser and we were close to collecting cheques, and then you sit back and think: ‘Oop, what’s going to happen next?’

“And the good news on Monday for us was no one batted an eyelid, they just kind of went: ‘Okay, it’s happened. Don’t know what you guys did, but okay, move on.’ And we collected quite a lot of money.”

In September, Livingbridge completed its largest ever fundraise, collecting £660m. The challenge now is finding the right companies to invest in, and convincing their leaders that private equity is the best option for them.

“[Small companies] really don’t think about private equity,” Kolade admits. “I’d love to think they did, and thought about it.

“If they think about it at all, they think about it in terms of: ‘I saw KKR bought Boots the other day. That’s private equity.’ If you’re running a £25-30m enterprise value company, they think: my natural option once I finish is to sell it to trade.”

Having made more than 100 investments, and taken on the challenges of an awkward name change and a record fundraise during a tumultuous period, one would assume Livingbridge is up to the challenge of putting its money to good work.

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