GTCR
Encyclopedia
GTCR LLC is a private equity
firm focused on leveraged buyout
, leveraged recapitalization
, growth capital
and rollup
transactions. As of 2008, it manages more than $8 billion in equity
and mezzanine capital
invested in a wide range of companies and industries.
The firm principally invests in high-growth industries, including business services and outsourcing
, consumer products and services, health care
, technology
, and transaction processing
.
The firm is based in Chicago
and has more than 80 employees, including over 40 investment professionals and is one of the most respected private equity firms in the country.
The company was founded in 1980 as Golder Thoma & Co. by Stanley Golder
and Carl Thoma. In the 1970s, Golder built the private equity program at First Chicago Corp.
where he is noted primarily for backing Federal Express
and for efforts as chairman of the National Venture Capital Association
and the National Association of Small Business Investment Companies to change federal laws allowing pensions to invest in private equity. Golder Thoma received much of its initial funding from William M. Blair
and upon leaving First Chicago, Golder was replaced by John A. Canning, Jr. who would go on to found rival Chicago private equity firm Madison Dearborn
.
In 1984, after recruiting Bryan Cressey to join the firm from First Chicago
, the firm's name was changed to Golder Thoma Cressey and with the promotion of Bruce Rauner to partner the firm would come to be known as Golder, Thoma, Cressey, Rauner, Inc. (GTCR), although it would still often be referred to as Golder Thoma.
In 1998, disagreements between the senior partners led Golder, Thoma, Cressey, Rauner, Inc. split into two private equity firms. Both firms continue to invest primarily through consolidations of specific industries, referred to as roll-ups
:
and other institutional investors.
Following its separation from Thoma Cressey (discussed below), GTCR has raised five private equity fund
s:
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
firm focused on leveraged buyout
Leveraged buyout
A leveraged buyout occurs when an investor, typically financial sponsor, acquires a controlling interest in a company's equity and where a significant percentage of the purchase price is financed through leverage...
, leveraged recapitalization
Leveraged recapitalization
In corporate finance, a leveraged recapitalization is a change of the capital structure of a company, a substitution of equity for debt —e.g. by issuing bonds to raise money, and using that money to buy the company's stock or to pay dividends...
, growth capital
Growth capital
Growth capital is a type of private equity investment, most often a minority investment, in relatively mature companies that are looking for capital to expand or restructure operations, enter new markets or finance a significant acquisition without a change of control of the business.Companies...
and rollup
Rollup
A Rollup is a technique used by investors where multiple small companies in the same market are acquired and merged. The principal aim of a rollup is to reduce costs through economies of scale. Rollups also have the effect of increasing the valuation multiples the business can command as it...
transactions. As of 2008, it manages more than $8 billion in equity
Stock
The capital stock of a business entity represents the original capital paid into or invested in the business by its founders. It serves as a security for the creditors of a business since it cannot be withdrawn to the detriment of the creditors...
and mezzanine capital
Mezzanine capital
Mezzanine capital, in finance, refers to a subordinated debt or preferred equity instrument that represents a claim on a company's assets which is senior only to that of the common shares...
invested in a wide range of companies and industries.
The firm principally invests in high-growth industries, including business services and outsourcing
Outsourcing
Outsourcing is the process of contracting a business function to someone else.-Overview:The term outsourcing is used inconsistently but usually involves the contracting out of a business function - commonly one previously performed in-house - to an external provider...
, consumer products and services, health care
Health care
Health care is the diagnosis, treatment, and prevention of disease, illness, injury, and other physical and mental impairments in humans. Health care is delivered by practitioners in medicine, chiropractic, dentistry, nursing, pharmacy, allied health, and other care providers...
, technology
Technology
Technology is the making, usage, and knowledge of tools, machines, techniques, crafts, systems or methods of organization in order to solve a problem or perform a specific function. It can also refer to the collection of such tools, machinery, and procedures. The word technology comes ;...
, and transaction processing
Transaction processing
In computer science, transaction processing is information processing that is divided into individual, indivisible operations, called transactions. Each transaction must succeed or fail as a complete unit; it cannot remain in an intermediate state...
.
The firm is based in Chicago
Chicago
Chicago is the largest city in the US state of Illinois. With nearly 2.7 million residents, it is the most populous city in the Midwestern United States and the third most populous in the US, after New York City and Los Angeles...
and has more than 80 employees, including over 40 investment professionals and is one of the most respected private equity firms in the country.
History
Stanley Golder
Stanley C. Golder was an American financier and venture capitalist.He is the namesake of the Stanley C. Golder Center for the Study of Private Equity at the University of Illinois at Urbana-Champaign, which he graduated ....
and Carl Thoma. In the 1970s, Golder built the private equity program at First Chicago Corp.
First Chicago Bank
First Chicago Bank was a Chicago-based retail and commercial bank tracing its roots back to 1863. Over the years, the bank operated under several names including The First National Bank of Chicago and First Chicago NBD...
where he is noted primarily for backing Federal Express
FedEx
FedEx Corporation , originally known as FDX Corporation, is a logistics services company, based in the United States with headquarters in Memphis, Tennessee...
and for efforts as chairman of the National Venture Capital Association
National Venture Capital Association
The National Venture Capital Association is the leading trade association representing the venture capital industry in the U.S. The NVCA represents the venture industry in public policy debates in Washington, DC, and promotes high professional standards, professional development, and interaction...
and the National Association of Small Business Investment Companies to change federal laws allowing pensions to invest in private equity. Golder Thoma received much of its initial funding from William M. Blair
William M. Blair
William McCormick Blair , was an American financier.-Life:William McCormick Blair was born May 2, 1884 in Chicago....
and upon leaving First Chicago, Golder was replaced by John A. Canning, Jr. who would go on to found rival Chicago private equity firm Madison Dearborn
Madison Dearborn
Madison Dearborn Partners is a private equity firm specializing in leveraged buyouts of privately held or publicly traded companies, or divisions of larger companies; recapitalizations of family-owned or closely held companies; balance sheet restructurings; acquisition financings; and growth...
.
In 1984, after recruiting Bryan Cressey to join the firm from First Chicago
First Chicago Bank
First Chicago Bank was a Chicago-based retail and commercial bank tracing its roots back to 1863. Over the years, the bank operated under several names including The First National Bank of Chicago and First Chicago NBD...
, the firm's name was changed to Golder Thoma Cressey and with the promotion of Bruce Rauner to partner the firm would come to be known as Golder, Thoma, Cressey, Rauner, Inc. (GTCR), although it would still often be referred to as Golder Thoma.
In 1998, disagreements between the senior partners led Golder, Thoma, Cressey, Rauner, Inc. split into two private equity firms. Both firms continue to invest primarily through consolidations of specific industries, referred to as roll-ups
Rollup
A Rollup is a technique used by investors where multiple small companies in the same market are acquired and merged. The principal aim of a rollup is to reduce costs through economies of scale. Rollups also have the effect of increasing the valuation multiples the business can command as it...
:
- GTCR Golder Rauner, (Stanley GolderStanley GolderStanley C. Golder was an American financier and venture capitalist.He is the namesake of the Stanley C. Golder Center for the Study of Private Equity at the University of Illinois at Urbana-Champaign, which he graduated ....
and Bruce Rauner), the $8 billion private equity firm, based in ChicagoChicagoChicago is the largest city in the US state of Illinois. With nearly 2.7 million residents, it is the most populous city in the Midwestern United States and the third most populous in the US, after New York City and Los Angeles...
, commonly referred to as GTCR. GTCR founder Stanley GolderStanley GolderStanley C. Golder was an American financier and venture capitalist.He is the namesake of the Stanley C. Golder Center for the Study of Private Equity at the University of Illinois at Urbana-Champaign, which he graduated ....
died in 2000 and today the firm is led by Bruce Rauner along with several partners (David Donnini, Ned Jannotta, et al.).
- Thoma Cressey, (Carl Thoma and Bryan Cressey) based in ChicagoChicagoChicago is the largest city in the US state of Illinois. With nearly 2.7 million residents, it is the most populous city in the Midwestern United States and the third most populous in the US, after New York City and Los Angeles...
and San Francisco. Thoma Cressey would be renamed Thoma Chressey Bravo to reflect the growing role of partner Orlando Bravo. In 2008, Bryan Cressey left Thoma Cressey Bravo with several investment professionals to form Cressey & Co. a small healthcare focused private equity firm. Thoma Cressey Bravo became Thoma Bravo after Cressey’s departure, led by managing partners Carl Thoma, Orlando Bravo, Lee Mitchell and Scott Crabill. The firm closed its 9th fund in March 2009 with $822.5 million.
Investment funds
GTCR invests through a series of private limited partnerships and its investors include a variety of pension funds (e.g., Washington State Investment Board, Pennsylvania State Employee's Retirement System) endowmentsFinancial endowment
A financial endowment is a transfer of money or property donated to an institution. The total value of an institution's investments is often referred to as the institution's endowment and is typically organized as a public charity, private foundation, or trust....
and other institutional investors.
Following its separation from Thoma Cressey (discussed below), GTCR has raised five private equity fund
Private equity fund
A private equity fund is a collective investment scheme used for making investments in various equity securities according to one of the investment strategies associated with private equity....
s:
- 1998 - Fund VI, ($870 million)
- 2000 - Fund VII ($2.0 billion)
- 2003 - Fund VIII ($1.8 billion)
- 2006 - Fund IX ($2.75 billion)
- 2011 - Fund X ($3.25 billion)