GP Profile: Maven Capital Partners

Entering its second decade in business, Maven since the beginning of H2 2018 has promoted five senior team members to partner, held a final close for its debut institutionally backed buyout fund and made a number of investments across a variety of strategies. It is also in the process of opening its 12th regional office in Reading.

Maven UK Regional Buyout Fund closed on £100m, having launched with a £125m target in April 2017. "The fundraising process was slightly longer than we expected," says managing partner Bill Nixon. "Notwithstanding the fact that our team has been together for a long time and we have a good buyout track record, perhaps not surprisingly we found that Brexit was a constant theme in investor discussions, particularly with investors from continental Europe. At this time it was an obstacle for some investors that might otherwise be natural partners for us. The flipside is that we were able to attract a number of investors in the UK and get close to our target."

Investors in the vehicle include IMWS (Nominees), Qualitas Equity Partners, Scottish Enterprise, Strathclyde Pension Fund and The Royal London Mutual Insurance Society, according to Unquote Data. The fund will look to make 10-12 investments overall; it targets companies with EBITDA between £2-5m and enterprise values of £10-40m, and writes equity cheques of £5-15m. It has made four investments to date: healthcare recruitment business Acton Banks Healthcare; automotive appliqués supplier John McGavigan; window, door and curtain walling system manufacturer CMS Window Systems; and door and window hardware importer and manufacturer UAP.

"The buyout fund is already around 30% invested," says Nixon. "The pipeline is strong, because we have such a big team across our network, and it is evolving day by day. Primarily, it's a question of conversion: whether we choose to act on the propositions in front of us."

The firm looks favourably on co-investment, says Nixon: "We have two strings to our co-investment bow. We have conventional co-investment, with LPs from the fund, and we have our Maven Investor Partner network, where we invest alongside a syndicate of high-net-worth individuals and family offices. For those who haven't made commitments to the fund, we are able to set up a vehicle that co-invests in larger deals completed by the regional buyout fund. Although the buyout fund has £100m in commitments, in combination with Investor Partners it has the ability to leverage larger deals."

Regional network
Maven is sector-agnostic in its approach, and its network consists of offices across Scotland and England. Its north-east England operations, which launched offices in Newcastle and Durham in May 2017, surpassed £10m in invested capital in March 2019. This is mostly deployed via its management of Durham County Council's £20m Finance Durham Fund and the £27m North East Development Capital Fund. In addition to managing a portfolio of venture capital trusts, the GP also currently has mandates to manage the Greater Manchester Loan Fund and NPIF Maven Equity Finance, part of the £400m government-backed Northern Powerhouse Investment Fund.

Overall, and following the close of the buyout fund, Maven has £600m in funds under management. "We do not see ourselves as a manager of a series of funds, but as a fund management business," says Nixon. "We have the experience, the wherewithal and the regional presence to be able to take on these [region-specific] mandates, and have done so regularly since Maven was established. Some of the funds also sit neatly alongside our investor partner syndicates and can co-invest with them. As the regional funds' portfolio companies grow, some become candidates to receive series-A or series-B backing from our VCTs. And it's worth noting that when we open an office to service a regional fund, we naturally also receive introductions to other transactions."

Maven has a conservative approach to both pricing and leverage, stating an average entry multiple below 5x for its investments since inception. Leverage is usually up to a maximum of 2x EBITDA.

Maven was founded in 2009 via the carve-out of Aberdeen Asset Management's private equity business. The Reading office will be its sixth new regional base since becoming an independent manager, and the GP has hired Connection Capital's Luke Matthews to lead the region's team. "We started with three Scottish offices in Aberdeen, Glasgow and Edinburgh, and three English offices in Manchester, Birmingham and London," says Nixon. "So we have doubled our office network over the course of 10 years. Although we don't have a regional fund in Reading, we have decided to build a presence in the Thames Valley and Berkshire market, as we believe it will be a good source of new deal introductions."

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