Five Questions with Accelmed’s Uri Geiger, TA sells Paula’s Choice to Unilever

Accelmed fields questions and TA exits Paula's Choice.

Happy Tuesday!

Today we bring you a Q&A with Uri Geiger, managing partner and founder of Accelmed, a Florida-based lower mid-market firm with a team on the ground in Israel.

What’s notable about Geiger’s firm is that its investing in US-based HealthTech companies that are unlikely to appeal to a traditional private equity fund.

More specifically, the firm targets relatively small companies between $20 million and $50 million in revenue size and usually with a negative EBITDA, Geiger said.

Most buyout funds will look at larger companies with larger checks, he said, but Accelmed looks at small companies usually challenged by capital structure, weak management or a product portfolio that needs to be rejuvenated.

Amid the pandemic, Accelmed acquired a position in NeuroPace based on a $20 million valuation for the company. Fast forward eight months later, it’s at a nearly $600 million value. “You cannot do that unless there is something so extraordinary like a pandemic, which held other funds from committing capital to new companies and made the company trip on debt covenants,” Geiger said.

Here’s an excerpt from Geiger’s conversation with PE Hub’s Sarah Pringle

How does Accelmed leverage its roots in Israel, where the firm has three people focused on sourcing add-ons?

“Israel has become a source of capital for funds. Some funds have placed one guy just to help bring Israeli institutional money, but there are no deal teams on ground for any other fund. By having our model well-known, we get the deal flow and have done a number of transactions in Israel. We can leverage Israel more efficiently than others.”

Check out the full Q&A on PE Hub.

Beauty mega-deal: TA Associates is exiting its stake in skincare brand Paula’s Choice after a five-year hold. The private equity firm sold the digitally native brand to Unilever for $2 billion, as reported by WWD.

PE Hub sources said the company generates EBITDA close to $100 million and confirmed that both private equity and strategics were part of the sale process. In addition, this wasn’t the first time TA explored a sale, “It’s been launched in the market a handful of times,” the source said.

Founded over 25 years ago, Paula’s Choice is a global direct-to-customer skincare brand started by one of the original beauty influencers, Paula Begoun.

The deal, which is expected to close in the third quarter, was led by Financo Raymond James alongside Morgan Stanley and Piper Sandler.

Read PE Hub’s brief on the deal.

That’s it! As always, write to me at karishma.v@peimedia.com with any tips, comments or feedback. Have a great week ahead!