Tecum Capital Management, an investment firm based in Pittsburgh, received a license from the U.S. Small Business Administration (SBA) to operate its third SBIC (Small Business Investment Company) fund and concurrently held its first closing for the new fund. This third fund is nearly fully subscribed at $240 million. Tecum’s new SBIC fund, Tecum Capital Partners III, L.P., will continue the strategies of its prior SBIC funds by making mezzanine loans and minority equity investments across many industries.
“This third SBIC license is a significant achievement for Tecum Capital as it will help drive our long-term growth plans,” Stephen J. Gurgovits, Jr., managing partner of Tecum Capital Partners, said. “This new fund aligns with our primary investment strategy to provide strategic, long-term debt and equity capital solutions for lower middle market companies.”
With a strong interest in rust belt states as well as the Midwest, Southeast and Mid-Atlantic regions, the team at Tecum Capital supports independent sponsors, family offices, private equity funds and management teams to facilitate recapitalizations, buyouts, generational transitions, acquisitions and other growth capital needs.
“Through strategic guidance and operational improvements, Tecum Capital offers an attractive partnership for our portfolio companies. Tecum is Latin for ‘with you’ and relationship investing is an important part of our business,” Gurgovits said.
Over the last eight years under its prior funds, Tecum Capital saw the total employee count of its portfolio companies increase 30% from 6,821 to 8,864.
The average investment size for the new fund will be $5 million to $20 million per transaction.
“Our investment criteria remains consistent with our predecessor SBIC funds,” Gurgovits said. “We are targeting the same size companies using the same proven strategies. Our investment philosophy is driven by a seasoned team at Tecum Capital, which creates a strong value proposition for our investors and clients.”
The investor base of the new fund includes many of the existing limited partners, along with several new institutional investors, including several new banks.
Originally launched as a wholly-owned subsidiary of its former bank parent company in 2005, the Tecum Capital team spun out and formed its first SBIC fund in 2013. Along with Gurgovits, the firm’s original founding partners include Matthew L.T. Harnett and Tyson S. Smith, all of whom continue to provide leadership to Tecum Capital’s now 16-person investment team.
Tecum Capital Partners III is a $240 million pooled fund of committed capital licensed by the SBA as an SBIC. The fund is managed by Tecum Capital Management, a private investment firm, which invests in mezzanine debt, subordinated notes, private equity and other securities issued by small and medium-sized commercial enterprises. The firm is focused on providing financing for recapitalizations, buyouts, generational transitions, mergers and acquisitions and other growth capital needs. The Tecum Capital team will work with financial buyers, independent sponsors, management teams and/or family office with its investments. Tecum Capital Partners III is headquartered in Pittsburgh with a geographic footprint that extends across the United States with a focus in the Midwest, Southeast and Mid-Atlantic regions.
