How has a mentor helped your career?
I have had many mentors, but the one that stands out is Daniel Harmetz. I met Dan when I joined Fidelity. Also trained as a lawyer, Dan had worked for Columbia Savings and Loan Association, a purchaser of a significant amount of high yield bonds. He had skills in both high yield and distressed investing. He encouraged me to learn as much as I could and worked with me on the significant investments I described in the answer to 1. He also pushed me to get Fidelity to allow the team to make investments outside the norm, such as bank debt and other distressed paper. To this day, Dan remains one of the smartest persons I have ever worked with. He introduced me to several of the significant investors of that time including Leon Black, David Tepper and David Bonderman.
What is your current role?
Currently, I am CEO of my own investment/advisory firm, Race Point Investors, LLC. I had a very successful career at DDJ Capital Management, LLC (“DDJ”), a firm I co-founded in 1996 with Dan Harmetz and David Breazzano. While I was at DDJ, the firm had assets under management of approximately $3 billion dedicated to distressed, high yield and hedge funds. I was responsible for managing the distressed portfolio. After I sold my equity in DDJ, I tried several careers before I settled on doing my own thing. A typical day for me involves spending considerable time on the phone talking to connections, evaluating new investments or advisory opportunities or attending meetings. I am often consulted on how to value assets or how to structure balance sheets. The firm is currently involved in two interesting situations, a distressed real estate play in Puerto Rico and a cannabis investment in California.
Describe your influence on the middle market.
Over the years I have worked on many middle market M & A deals, mostly from distressed investments made by DDJ, where the debt has been converted to equity and DDJ funds had obtained control. Some examples include the sale of Smith & Hawken, Ltd, a high end garden supply retailer, to Scotts Miracle-Gro Company, the sale of Waste Systems Internation, Inc., a solid waste hauling and landfill company, to a private equity fund managed by AIG, and the sale of CML Innovative Technologies, a specialty lighting company, to Grupo Antolin, Spain.