Prophet Equity Opens Doors to Invest in Lower and Middle Market Companies
Prophet Equity LLC (December 13, 2007)
Public Press Release
Southlake, TX – – December 13, 2007 – Prophet Equity LLC, (“Prophet”) a private equity firm that makes control investments in companies with revenues under $500M and collaborates with existing management to improve profitability, formally opened its doors this month in Southlake, Texas, a suburb of Dallas, Texas.
Prophet focuses on strategically viable companies in special situations, turnarounds, acquisitions, bankruptcies and reorganizations. Prophet uses proven, data-driven analytical techniques coupled with decades of investment and management experience to invest in, unlock, and realize future value today. Partnering with owners and management teams, Prophet principals deploy a toolkit that is Fortune 500 tested and private equity proven to diagnose and drive dramatic value creation. Portfolio company management teams are highly motivated with clear, uncapped incentives based on realized business performance.
With a 20 year track record of delivering outstanding financial results for both clients and investors in lower and middle market and Fortune 500 companies, Gatlin and the Prophet team focus their attention on a part of the private equity landscape that is one of the largest – smaller and mid sized businesses – but one that is also underserved by other investment firms who often target larger deals or ones where current financial performance is strong.
Gatlin and the team are experienced in returning value to investors and shareholders. Gatlin has helped lead the investment and management of approximately $300M in control equity across companies with over $2.5Bn in revenue generating sizeable returns to investors. Prophet’s senior team has led operational improvements at a series of private, private equity owned and public companies where significant shareholder value was also created. Moreover, each has assumed operating roles in numerous companies across an unusually broad array of industries where they put their value creation toolkit to work. First learned at international strategy consulting firm Bain & Company and then honed in operating and investment situations at private equity firms, the Prophet Equity team applies its unique, Holistic Value Creation approach through a set of proven strategic and operating tools which optimize performance across all areas of a company including manufacturing, finance, working capital, taxes, sales, marketing, IT, product development, channel management, distribution and procurement to map a battle plan with management teams that yield rapid improvements as well as dramatic, long term value creation.
“This is an exciting time in private equity and at Prophet Equity”, commented Ross Gatlin, CEO and Managing Partner. “Given the credit crunch and the demands placed on small and mid sized business, being a passive financial or strategic buyer with deep pockets is no longer good enough. You have to partner with management and bring tools to the table which are powerful and proven for turbo-charging growth and delivering tangible value at strategically viable companies.”
Gatlin’s experience confirms his track record of value creation. Educated at The University of Texas at Austin and with an MBA from The Kellogg School at Northwestern, Gatlin began his career at an investment bank specializing as an advisor in bankruptcies, restructurings and distressed situations. After working for years at Houlihan Lokey Howard & Zukin, Gatlin then joined international strategy consulting firm Bain & Company, where he worked on a number of high profile profit improvement clients such as the turnaround at Continental Airlines and the merger of Lockheed and Martin Marietta to name a few, as well as due diligence and implementation work for other acquisitive corporate clients and private equity firms. Post Bain, Gatlin was first a founding principal at The Carlyle Management Group and then a founding partner at Insight Equity, where he invested his own money alongside institutional dollars and helped build operating portfolios with billions of dollars of revenue across a diverse set of industries while also driving operating improvements which delivered exceptional returns to investors and management teams.
Gatlin met and worked with many of the Prophet team memebers while working at Bain & Company and the prior private equity firms he was a founder in. At Bain, they worked with Continental Airlines, Dell Computer, Ford Motor Company, Schlumberger, Sabre Group, DHL and other large global companies, on profit improvement and turnaround initiatives. Meanwhile, other Prophet team members worked on similar initiatives at other middle market private equity firms, consulting firms and lower and middle market operating success stories.
“The response thus far from potential investors and our deal sources has been extraordinary”, explained Gatlin. “The value proposition we are offering to the market has decades of experience and a proven investment track record to back it up, and people seem to ‘get it’ immediately, whether they are investors, managers, lenders or advisory firms looking to partner with an activist firm like ours, or prospective employees looking for an exciting and rewarding career. The future looks bright, but we know we have a lot of hard work ahead of us.”
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