Women in PE to Know: Ann Ferreira

April 21, 2020

The interview below is part of an ongoing effort by McGuireWoods to profile women leaders in private equity (PE). To read previous profiles, click here. To recommend a woman for a future interview, email Amber Walsh at [email protected].

Leslie Frecon

Ann Ferreira is a corporate finance and PE professional with more than 25 years of experience and currently serves as a co-founder and partner of Lake Country Capital (LC2), a debt and structured equity investment firm serving the lower middle market. She previously served in senior leadership roles at Good Harbor Capital and Churchill Capital, where she led and managed investments in lower middle-market businesses. During the first 14 years of her career, she worked in the investment banking divisions of Deutsche Bank Alex. Brown, Bank of America and Chase Securities, providing financing to clients and advising on a range of corporate finance issues, including mergers and acquisitions (M&A) and restructuring.

Ann holds a B.S. from Cornell and an MBA from Wharton. She has been a board member or board observer to numerous middle-market companies.

Q: What attracted you to PE?

Ann Ferreira: I was attracted to middle-market PE because I love working with business owners and supporting their goals. I was fortunate to be exposed to many industries through multiple economic cycles early in my career. My first roles in corporate finance were in credit and restructurings, where I learned how financial solutions for businesses could be either good or bad. Coming from my background in corporate finance, M&A and restructuring, it was a logical progression when I was recruited to the buy side in 2002. The opportunity to assist small business owners who often lack direct experience in these matters, to use a variety of skill sets and to invest across multiple industries was compelling to me then and continues to fuel my interest today. And now, building my own firm as an owner/entrepreneur at LC2 is an exciting new challenge in my career.

Q: Why is it important for more women to pursue careers in PE?

AF: I would flip the question: Why is it important for PE to be attracting more women? There is a strong business case supporting active recruitment programs for women — and talent diversity in general.

First, PE firms want to work with the best and the brightest. That’s difficult to do when you are missing 50 percent of the population. PE is a field that requires many skill sets, with winning combinations improving outcomes. A broad talent bench enables firms to field the right team player for any given situation.

Second, middle-market PE is a relationship business. A comprehensive team will generate more and better market opportunities. Business owners and management teams select their PE partners. Referral sources such as lawyers, accountants and bankers direct deal traffic. They value and seek different experiences and personalities, even within a given PE team.

Third, limited partner investors and asset allocators are increasingly identifying and pursuing fund managers that demonstrate frameworks to optimize talent.

Q: What advice would you provide a women-led company interested in securing PE?

AF: Plan and prepare so you control your destiny! Plan well ahead of the timeframe you expect or intend to enter a transaction. It will always take longer than you think to execute a partnership. The less prepared you are, the greater the risk of failing to secure PE on commercial terms and finding the right partner.

Assess your business as it stands today, then define your objectives in the context of a 3-5 year business and financial plan. Consider your capital requirements and your personal goals (e.g., full exit, partial exit, succession). Consider your team today and the professionalization required to optimize a future partnership. Seek trusted, experienced PE advisers to demystify the PE landscape, assist you in your assessment and prepare and review the pros and cons of a transaction. This may require advisers with specialized and/or complementary skill sets to prepare you for the PE process.

With a well-thought-out game plan, you can find the right capital partners to meet your goals. For most middle-market business owners, these are once-in-a-lifetime events. You won’t get a do-over, so be intentional.

Q: Is there a benefit to being proactive in establishing PE relationships?

AF: I would consider this a natural — but not obvious — extension of an owner’s strategic business development plan. These efforts may result in excellent networking and learning opportunities that can be of tremendous value even when there is no defined PE agenda. The right contacts often have relevant experience in the issues owners are tackling and, therefore, can be great sounding boards. And you never know when an established connection will become a game changer.

I have a personal example to illustrate this point. An acquaintance reached out regarding a growth equity financing that would be the first outside capital for her consumer business. The capital was needed to support a large national order from a big-box retailer. She had three weeks to close a financing deal and had a term sheet from a source referred to her by industry friends. She was concerned about the terms, and rightfully so. We worked up a new solution that met the timeline and was a less dilutive option with no springing control features tied to near-term profitability, which was an unrealistic expectation for an early-stage, growing business in her sector. Her deep network, which she actively developed over several years, saved her from a bad deal that could have ultimately cost her control of the company. Now, five years later, the business is thriving under her leadership.

To contact Ferreira, email [email protected].

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