How They Did it: Betting on Yourself in the MBO Process

Rosemont Roundtable: Exploring the Business of Investment Management (Formerly Global Investment Leaders)

In this episode of How They Did It, a subseries of Rosemont’s Global Investment Leaders podcast, host Brad Mook is joined by Scott Priebe, Managing Principal and Portfolio Manager at Geneva Capital Management. Based in Milwaukee, Wisconsin, Geneva is a majority employee-owned investment boutique managing roughly $5 billion in long-only US equity strategies and specializing in small- and mid-cap quality growth.

During their conversation, Priebe shared his unique perspective on investment firm ownership, which has been formed over a series of ownership transitions since Geneva’s founding in 1987. Seeking to grow and diversify the firm’s investment strategies and revenue drivers, in 2014 Priebe and his partners merged with London-based Henderson Group. Yet just two years later, the firm’s new parent organization merged with Denver-based Janus Capital Group, upending Geneva’s strategy for long-term, sustainable growth. It is from this juncture that Priebe shares his insights on why and how he and his partners pursued an MBO and the factors that made it successful, including:

• The catalyst that led Priebe and his partners to seek their independence from their parent organization and return to operating as an independent boutique
• How Priebe and his partners approached the parent management team, with the goal of creating value for both firms and their clients
• The risks and rewards of betting on themselves, particularly amid the competitive headwinds faced by independent, long-only equity managers
• Navigating valuation, financing and the many logistics that are required when completing an MBO
• How Priebe and his partner structured the ownership of newly independent Geneva, offering employee ownership across functions to capitalize on the team’s entrepreneurial spirit

To hear another episode about navigating the complexities of an MBO, be sure to listen to Mook’s recent conversation with Todd Vingers, CFA, who serves as president of the recently launched Leeward Investments. All episodes of the Global Investment Leaders podcast are available on Apple Podcasts, Spotify, Google Podcasts and more. Receive the episodes as soon as they premiere by subscribing today.