Recently, Managing Partner Heather Hubbard was interviewed by Virtus Private Investment Practice on the opportunities/challenges that COVID-19 has introduced.
- Please Describe ValescoValesco is a growth oriented private equity firm focused on making equity and subordinated debt investments in lower middle market businesses.
- What is your role within the organization?As Managing Partner, I lead all functional areas of our group – from marketing & investment origination to portfolio company management & divestiture. Internally, my primary focus is on leading our business development, finance & compliance and transaction teams.
- From an investment perspective, where do you expect opportunity to arise from the changing economic landscape due to Covid-19?We believe that opportunities will arise out of this changing landscape. While we have seen a significant slowdown in investment banked auction processes, Valesco employs significant resources into our direct-to-business owner marketing efforts and believe that this is the channel where there will be significant value from an investment origination standpoint. Companies will require capital for growth to restart after this pause that Covid-19 has forced the world into. We expect to see positives and negatives from this event, but believe we are in a great position to be a value added operational partner with business owners through this crisis.
- What positives are arising in either your business or philanthropic pursuits in this current environment?Some of the companies we are invested in are faring well from this change in life circumstances. We have a spice and ingredients manufacturing company in Gonzales, TX called Adams Flavors, Foods and Ingredients that has seen a significant increase in retail sales as people are shopping at grocery stores more and need spices and ingredients for the food they are cooking. On the philanthropic side, we feel fortunate to be able to give back and we’ve encouraged our team to do the same. We created a donation matching program with our Valesco team members so that we could supercharge the contributions they were making to organizations that are helping our community during this time.
- Valesco has historically focused on growth strategies that provide job growth in a region. What advice do you have for CEOs in tough times?Hope is not a strategy. Take an honest look at your current cash position, your ability to generate cash during this time and how deep the cuts need to be to sustain your operations. Try to create a 3-6 month cash reserve that can help you survive in a severely depressed demand scenario and plan for a prolonged recovery that could extend into 2021. Finally, if you have outstanding loans and a relationship with your bank, engage them in conversations and set right performance expectations for your company in the next 12-18 months. If demand and life returns to normal quicker than expected, you will come out of this period strong. If it takes longer to recover, you and your business will live to fight another day.
- Are you working on any personal improvement plans?My husband and I are juggling our typical day to day combined with our new jobs as pre-school and kindergarten teachers for our three kids. The struggle is very real, but it’s great to be able to walk out of my home office and immediately be home to engage in the day with each of them. We’re lucky to have this time together.
To learn more, view Heather’s full bio here.