Lamar Stanley is Vice President of Gen Cap America, a private investment firm headquartered in Nashville, Tennessee. GCA specializes in acquisitions and recapitalizations of quality middle market and lower middle market businesses with revenues between $10M and $200M. Before joining Gen Cap in 2016, Lamar was with Diversified Trust Company, a wealth management firm where he worked in their private-equity strategy group. Prior to Diversified Trust Company, Mr. Stanley served as an intelligence officer in the United States Navy. He holds a B.A. degree from The University of the South, in Sewanee, TN, and an M.B.A. from The University of Chicago.
Tell us about your career pre-Gen Cap America and how it led you to do this work.
I come from a Navy family going back multiple generations, so I followed the family tradition and spent the first (almost) decade of my professional career serving in the U.S. (world’s strongest) Navy. I was an intelligence officer and was assigned to three different units after intelligence training. After multiple deployments (to Afghanistan, Iraq and once afloat on the USS Theodore Roosevelt) and two kids, I decided to get out and settle things down a bit. I decided to go to business school to try to learn what the “real world” looked like before diving in, and it was there where I interned for a private equity firm, Woodlawn Partners. The senior partners there (Evan and Greg) took me under their wing and helped me learn what the business was about. And that’s where I fell in love with the work.
Are they any parallels between your position as an intelligence officer in the U.S. Navy and your work today?
No question. Hunting for deals is not that different from hunting HVT’s (high-value targets). You must kick over a lot of rocks, and they don’t come to you. And similarly, persistence and good processes are what lead to success.
However, the keys to success in this business are no different than the keys to life that I repeat to my kids every morning before letting them out at school: “work hard, be kind, help someone.” Those work in the military, deal world, or in Mrs. Langdon’s third grade classroom.
What personal characteristics and strengths have supported your success in this industry?
I like meeting people and hearing about different businesses. There’s nothing I love more than digging into a CIM about a business that I didn’t know existed. And I don’t think there are many industries where you get so many opportunities to talk with people who have built something successful from the ground up.
What is your greatest professional accomplishment?
I certainly benefit from standing on the shoulders of three decades of history here at Gen Cap, so I can’t claim this accomplishment as singularly my own; however, I’m proud of the reputation that I’ve been able to maintain here at Gen Cap. We pride ourselves on being a firm that isn’t “in love with itself” and shoots straight. I think my best accomplishment is perpetuating this reputation. This is my primary goal for the remainder of Fund 7 and for all the funds to come.
Regarding most of your engagements, do you work as a team or do you handle things on your own?
One of the primary benefits of Gen Cap being a pretty lean team is that we all stay pretty plugged in to what’s going on across the firm.
What is the biggest mistake you have made when working on a deal?
I can’t point to any specific mistakes as being my biggest (I’ve made a lot); however, I think the common thread across all my mistakes has been a lack of communication. At Gen Cap, we always try to be quick with communication and do our best to overcommunicate.
What is the most interesting deal that you are working on today?
We’re currently looking at a distribution business that services some “austere” locations within the United States. As most of our distribution businesses, there’s a heavy service element.
How long have you been an M&A Source member and what do you get out of your membership?
I have been a member of M&A Source since 2016, and we (Gen Cap) are sponsoring members. And to say that we value our membership in the organization would be an understatement. We love the close-knit community of the organization, and how it perpetuates a lot of the same values that we hold dear in the deal community. We love the collegial nature of the membership, and we love that the conferences serve as an excellent opportunity for us to swap notes and quickly hear what others are seeing and hearing out in the market – whether that be with fellow private equity firms or intermediaries. The organization serves as a great way for us to stay abreast of the pulse and best practices in the market.
As a seasoned equity investor, what changes and trends do you see on the horizon that will impact M&A?
We expect a big year from an M&A perspective in 2021. We think there will be a considerable backlog of owners who weren’t able to go to market in 2020 who will be looking to exit next year. Whether it was company performance, tentativeness due to prospective tax changes, etc., there were many reasons for dealmakers to have a reticence to charge into the market.
How is COVID impacting your work and how you view potential investments?
We’re back in the office, but travel is still a struggle and we don’t anticipate that changing any time soon. While we hope that things will steadily improve on the COVID front, we expect more “1st management meetings” via Zoom, a lot of diligence being done remotely, and more diligence of items that weren’t really on the radar previously.
We anticipate more questions around business owners’ compliance with PPP loans, laws relating to COVID, employee impacts, supply chain impacts, contract performance (force majeure clauses), the list goes on and on. You’d be hard-pressed to find a business that wasn’t impacted in some way by COVID – it’s now a section of our checklist.
Please tell us something about yourself that has nothing to do with your M&A career.
In my house, I’m “big Lamar.” My son is “little Lamar.” My cousin is “Anna Lamar.” My uncle is “Uncle Lamar”, and my grandfather, Pop, was also a Lamar. We’re not a very creative family, and holidays have always been confusing. 😊