We are looking for great businesses at the right prices, with less of an emphasis on specific industries or geographies. We target companies that are founder / family owned, have growth potential and focus on delighting people (employees, customers, suppliers). In addition, industries should have low operational complexity and limited landscape risk (including technology obsolescence, regulatory risk, legal risk, environmental risk, major cyclicality, fads / trendy). Industries of particular interest are Services (Business, Consumer, Healthcare, Financial), Mature Technology, Consumer Products, Light Manufacturing and Value Added Resellers. We prefer to avoid early-stage emerging technology, early-stage life sciences, and real estate development-related opportunities.
Within preferred industries, companies are targeted based on sustainable market position, history of reliable cash flow, substantial recurring, predictable revenue and low customer and supplier concentration. Specifically, we will look for a consistent track record of pre-tax profit between $750,000 and $5,000,000.
We make majority and minority investments. With regards to majority investments, we prefer company founders who are looking to transition their business to a new generation of leaders who will work to grow the enterprise value of the business, while also maintaining customer relationships and employees. We endeavor to work closely with existing management whenever possible to ensure continuity during an ownership transition, and provide owners an opportunity to successfully exit while knowing that the legacy of the business’ impact can continue. With regards to minority transactions, we look to come alongside company builders as they look to take the next step in their growth. We are equipped to invest growth equity and conduct minority equity buyouts alongside these leaders.
Our investment team is made up of operators and investors with industry and regional expertise.
Henry Kaestner is a Co-Founder and previous CEO, and then Chairman of Bandwidth.com, a company that together with his business partner, David Morken, he has grown from $0 to $250 million in revenue. The values of Bandwidth.com have always been: Faith, Family, Work and Fitness (in that order). Bandwidth.com was the 4th fastest growing privately held company in the country from 2003 through 2007, a position it achieved without acquisition or institutional funding. Prior to co-founding Bandwidth.com Mr. Kaestner founded Chapel Hill Brokers (a predecessor to ICAP Energy), an institutional energy derivatives broker that became the top ranked electricity broker in the country. Mr. Kaestner has also been involved in a number of ministry and philanthropic activities. He co-founded DurhamCares, sits on the Board of Visitors at the University of North Carolina at Chapel Hill, and the Board of Directors of Praxis, an accelerator committed to helping Faith driven entrepreneurs. He also serves on the Board of Directors of Bandwidth, Republic Wireless, CloudFactory, ThriveFarmers, First, and RevBoss. Additionally, Henry serves as an elder in the Presbyterian Church of America and lives in Los Gatos, CA with his wife Kimberley and their three sons.
Luke Roush co-founded Sovereign’s Capital in 2012, and is a Managing Partner for the firm. While living in Kuala Lumpur and Jakarta from 2013-2016, he opened the fund’s operations in Southeast Asia. Luke is primarily focused on the fund’s healthcare and consumer product investments. Prior to Sovereign’s Capital, Luke had twelve years of experience in global commercialization and business development at venture-backed and Fortune 500 companies. He was Vice President for Sales, Marketing, and Business Development at TransEnterix, a medical device company that developed and commercialized a minimally invasive surgical system in the US, Europe, and Asia. Prior to joining TransEnterix (NYSE:TRXC), he served as Chief Operating Officer at Liquidia Technologies, a nanotechnology company focused on biopharmaceutical applications. Luke previously served as global marketing manager for the neurovascular stroke business at Boston Scientific’s (NYSE:BSX). He also co-founded 410 Medical, a device company focused on pediatric emergency care, in 2012. Luke graduated summa cum laude from Duke University, and later earned his MBA from The Fuqua School of Business. Luke resides in San Jose, California with his wife, Brooke, and their three children.
CFOJim Fogleman is the Chief Financial Officer of Sovereign’s Capital. He is also the CFO of Cherokee Investment Services. For both firms, he oversees investment-level financial reporting and compliance matters on behalf of the private equity funds. Prior, he held CFO positions with privately held companies involved in start-ups, turnarounds, and real estate development. These companies included Blue Rhino Corporation, the nation’s largest propane cylinder exchange marketer/distributor; Platinum Service Corp., a developer of Boston Market restaurant properties located primarily in the Carolinas and Georgia; and National Packaging Solutions Group, a southeastern US manufacturer and distributor of industrial packaging. Mr. Fogleman began his career in public accounting with Price Waterhouse and later with Pryor, Sills and Fogleman and the Daniel Professional Group. He earned a BS from the University of North Carolina at Chapel Hill and is a licensed CPA in North Carolina. Mr. Fogleman and his wife Mary Edna have three sons.
Throughout the course of his career, William has spent over six years in Private Equity and Investment Banking, along with over five years pursuing entrepreneurial endeavors. He has investment experience in technology, real estate, power, sports and healthcare. He co-founded an adventure race company and two technology companies. He loves finding unique investment opportunities, working with people and helping them become the best version of themselves. For Sovereign’s Capital, William focuses primarily on investing in traditional businesses in the lower middle market, which also includes all of Sovereign’s search fund investments. He founded the Faith and Work ministry at Reality SF and loves engaging in any conversation about how to make work more meaningful in the world. He received an MBA from the Stanford Graduate School of Business and a BS in Finance, Summa Cum Laude, from the University of Alabama, where he was named a USA Today Academic All-American. William is married to a wonderful woman named Deb that continually challenges and refines him. They welcomed their first son Liam in 2018. William spends the majority of his time pulling for the Alabama Crimson Tide, coaching 7th grade basketball and trying to figure out where he lost his golf swing.
Jake has 12 years of experience in operations and advisory roles spanning from start-ups to public companies. As AVP of Bank of Hawaii, Jake oversaw sales, operations, customer engagement, and marketing for a regional team, with a focus on providing advice and growth capital to local entrepreneurs. He spent four years as an independent consultant, delivering strategy and operations advisory services to start-ups and small companies in the U.S. and Africa. Clients included a distributed solar energy company in Tanzania, a technology commercialization firm in North Carolina, and an innovative credit union with offices across the U.S. As Lead Associate in the Strategic Innovation Group of consulting firm Booz Allen Hamilton, Jake launched and managed a SaaS cybersecurity risk product for large IT organizations, and led business development for energy offerings in Jakarta, Indonesia. He also helped to stand up the Internet of Things (IoT) division, which develops and delivers IoT products and services to Fortune 100 clients. Jake serves as a Principal at Sovereigns Capital. He lives in Washington, D.C., with his wife Lauren, where he is a board member of Little Lights Urban Ministries and Trinity Fellows Academy. Jake graduated magna cum laude in Economics from Pomona College, and later earned an MBA from The Fuqua School of Business and an MPP in international development from the Sanford School of Public Policy.
Our advisors contribute their functional, industry, and regional expertise in the discovery, diligence, and ongoing management of portfolio companies. The gallery below is a non-exhaustive sample of our advisors.
In addition to traditional buyout transactions, we are supporters of the search fund industry.
A search fund is an investment vehicle through which its founders search for, acquire, and operate a single business. The principals of these Search Funds – called “searchers”- are often recent graduates of top business schools in the U.S. and abroad. However, we have also seen many successful searchers re-inventing their careers after many years in the business world. You can learn more through the Stanford Search Fund Primer and a great video by investor Coley Andrews.
The Principals of Sovereign’s Capital enjoy the unique opportunities we have through search funds to work with young entrepreneurs as they evolve into emerging business builders and grow exceptional companies.
Should you have an interest in learning more about our search fund efforts, please contact firstname.lastname@example.org.
San Francisco Bay Area
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Back Office and Operations
Attn: Jim Fogleman
111 East Hargett Street, Suite 300
Raleigh, NC 27601