Venture Profile: River Capital Prefers To Own Rather Than Invest

Editor’s note: Local Tech Wire features a profile of a venture or investment profile firm each business day. Among the oldest middle-market buyout firms in Atlanta, River Capital was founded in 1983 by Larry Mock, who went on to become chief executive of Mellon Ventures, a big backer of technology firms. Yet River Capital has not made any technology bets in recent years and, with $54 million under management, has been bypassed in terms of size by many younger venture firms that focus on tech investing.

River Capital typically invests between $3 million and $7 million in a portfolio company.

It prefers firms in the light manufacturing, distribution and service industries with at least $10 million in annual revenue, stable earnings and a secure market position that present opportunities for internal growth, geographic expansion or industry consolidation.

The firm generally assumes majority ownership of its portfolio companies. However, River Capital does provide management, which often participates in the buyout or re-capitalization, with a free rein to run the business.

Recent investments have included aircraft service providers Piedmont Aviation and TronAir, furniture and accessories manufacturers Decor Gravure and Winston Furniture and newspaper publisher Hometown Communications.

Here’s the skinny:

Featured Firm: River Capital, Inc.

Mailing address: 1360 Peachtree St., Suite 1430 Atlanta, GA 30309

Phone number: (404)873-2166

Web site: www.river-capital.com

Management Team:

Jerry D. Wethington
F.W. Hulse
J. Phillip Falls
Jon Van Tuin

Focus of firm: Light manufacturing, distribution and select service industries

Money under management: $54 million

Representative investments:

Hometown Communications, Inc.
Piedmont Aviation Services, Inc.
Tronair, Inc.
Winston Furniture Company, Inc.
American Threshold Industries
Consumer Product Enterprises, Inc.
Décor Gravure Corporation, Inc.

In what size range: $3 million to $7 million

Sweet Spot (types of deals, stage of the company): Companies seeking second-stage expansion. Late-stage expansion, or buyout or acquisition financing.

Most important attributes for companies seeking funding: Management team with a proven track record and at least $10 million in sales. We do not invest in companies involved in real estate, oil and gas or financial services.

What differentiates you: Required to turn over a majority interest in the company to River Capital’s portfolio, but company’s management receives and maintains daily operating control and a significant percentage of ownership.

Monday’s profile: Southeast Technology

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