Americans over 50 control 77 percent of total net worth and have nearly $46 trillion of wealth, U.S. News & World Report said in June, citing statistics from the Bureau of Labor. Baby Boomers are aging; the youngest turned 50 in 2014.
“There are lots of (Baby boomer) families going through transitions where the children don’t want to take over their companies. We’ll be happy to partner with them,” Turner said.
Soundcore is not looking for the owners to leave, Turner said. The firm wants to help boomers diversify their net worths, get some liquidity and remain running their companies if they want, he said.
Turner, who at 33 is not a boomer, launched New York-based Soundcore officially on April 1. He was previously a senior manager of investments in Sumitomo Corp.’s private equity division. He also worked at Sun Capital Partners and Clearview Capital.
Soundcore —which takes its name from a combination of “sound investments” and “core principles” —will target family-owned businesses located in the United States and Canada and generating $20 million to $100 million in revenue. The firm, which plans to invest from $4 million to $30 million equity per deal, is only seeking control investments, Turner said.
The firm is backed by family offices, wealthy individuals and funds of funds, Turner said. Some of its capital is committed in a blind pool, while the rest in the form of a pledge fund in which investors have the choice to investor or not. “We can comfortably invest $30 million in a single deal,” he said.
“I plan to launch our first formal fund with institutional investors in four years,” he added.
The PE firm plans to invest in industrials, healthcare services, consumer products and business services, including distribution. There are some sectors, like financial services, that are not of interest. Also not on Soundcore’s menu are so-called “fashion risk” investments, like apparel, restaurants and retail. These sectors can suffer a change in consumer sentiment “over night,” Turner said. “That’s why we don’t like those.”
The firm is running lean but does plan to hire, Turner said. For now, Soundcore is comprised of Turner, one associate and a general counsel. The firm will also have three analysts from NYU working this summer, Turner said. The firm wants to add a deal partner and a partner to handle originations, he said.
Soundcore also has a team of six operating executives available. But these executives won’t be taking over companies. “We’re not looking to replace (management) with our operators. Our operators will be sitting on the boards.”