Duke Street story, Peter Taylor, Managing Partner
Our mission at Duke Street is to accelerate the growth of the companies that we buy. We do this by attracting and working with some of the very best managers out there. They’re attracted by the unique mix of Investment Partners and Operating Partners that we can offer at Duke Street - different from our competitors - and its those managers that create the value over the long term, that in turn attracts our investors to support us.
Duke Street takes a long term approach to value creation. It’s not just about selling a company after five years, we have to persuade the next buyer that there are five to ten years of sustainable growth in that business when we sell it - that’s the way to achieve the best price. The relationship with management is critical in Private Equity, and at Duke Street we have a different way of approaching that, we call it the Duke Street Triangle. It’s the relationship between the CEO, the Investment Partner who sits on the board, and our Operating Partner who also sits on the board, usually as chairman.
That relationship is critical, it provides the right framework for management. They have the right level of operational freedom and they have an open route into Duke Street and absolute clarity about where they stand.
The Duke Street model works well in good times and bad. Even in the ongoing credit crunch, we still have very strong relationships with our banking partners, built up over the last twenty years. We have an extremely good record of avoiding losses, of mitigating risk, and our banking partners remember that now that times are tougher.
There are several things about our model which, taken together, make us stand out very clearly from the crowd. The first is the way we originate deals. The majority of our deals come outside auctions, and that’s a claim that very few of our competitors can make. And how do we achieve this? By getting to know management teams well ahead of any kind of process, getting to know them as people…their business…so when it comes to the time of the deal we can offer certainty to the sellers, do the deal quickly and then get on with the important job of accelerating growth.
Buy and build has become a real catch phrase…a buzz phrase in the industry, particularly recently. But for us, this has been a philosophy over twenty years at Duke Street. By that we mean we are looking to buy companies that can grow faster - both through acquisition and organically - and even in the current credit crunch, we’ve seen the pace of build-up acquisitions for our companies actually accelerate against the trend.
We keep the portfolio at Duke Street deliberately compact, so that we can invest the right amount of resource and care into each of our companies. They all have their own growth plans, we provide the right level of intensive resourcing - both financial skills and operating skills - and that’s a mix that few of our competitors can offer.
I’m very proud that all the people at Duke Street share the same straightforward and open values in business, and that means we can make decisions more quickly and be more transparent about those decisions from the outset. And in turn that appeals to exactly the kind of CEOs we want to work with. They also tend to be straightforward, committed, and above all, ambitious.
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