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Success Story

July 2009 - Kansas City, MO - TGP Capital Partners brings new meaning to "raising the roof" with the investment success story of DaVinci Roofscapes of Kansas City, Kansas.

The private equity group brings a partnership approach to identifying and working with middle market companies that have significant growth potential, but may not be reaching their potential due to lack of capital resources.

"DaVinci Roofscapes is a perfect fit for TGP," says Shane Parr, Managing Director, TGP Investments, LLC. "We look for innovative companies that we believe have good long term growth prospects and need a financial partner to provide capital and capital markets knowledge to help them achieve their strategic and financial objectives and maximize the return to all shareholders." TGP invests in primarily U.S.-based, middle-market companies in general manufacturing and business services. By partnering with management teams and owners, TGP tries to maximize management's strategic plan by providing capital for internal growth or acquisitions, a lucrative incentive package for management teams and creates a board of directors to help management achieve their goals.

Operating from a manufacturing facility in Kansas City, Kansas, DaVinci Roofscapes manufacturers of award-winning
synthetic slate and shake roof tiles. Founder John Humphreys started developing the DaVinci product in 1997 and officially launched the company in 1999. After continued product research and formula engineering, the first DaVinci roofing product was installed in 2001. The tiles are rated Class A for fire retardance, have received the highest ratings for straight line wind testing at 110 mph and rated Class 4 for impact resistance and have been accepted by the Miami Dade County for high velocity hurricane winds.

In 2006, a TGP investor who had a relationship with founder John Humphreys, introduced TGP to the award winning tile manufacturer. At the time, DaVinci was an up and coming company with a lot of potential, but needed capital and additional management talent to help develop sales channels to foster continued growth and to invest in product innovation. New CEO, Ray Rosewall, joined the company, to help move it forward.

Building a solid management team quickly became the first priority for Rosewall and TGP. Unlike other private equity groups, TGP's approach is supportive without micromanaging. "I've worked with a lot of great financial brains in my career, many who wanted to get involved with the daily operations of the business,' says Rosewall. " That's not the case with TGP. They say 'when we made the investment, our interest was based on your talent and your strategic plan and we are here to support you in any way we can'." With management's plan and help from TGP, DaVinci has grown by 20% every year since 2006.

Working with Rosewall's team, TGP formed a board of directors, a group of experienced and diverse professionals including an attorney experienced in mergers and acquisitions to a tenured real estate executive to a successful private investor who owns an injection molding company and became instrumental in identifying a Chinese based supplier that provided much needed molds at a fraction of the expected cost. "A small business can't afford to throw the dice. We wouldn't have been able to take the chance that we would find a supplier to make that part of that quality and at that cost," adds Rosewall.

In addition to providing an influx of capital, Rosewall and his team quickly realized another benefit of working with TGP : happy employees. Facing a downturn in the home building business, Rosewall knew that keeping his star employees was going to be critical to DaVinci's future. Once the deal was announced, DaVinci's 50+ employees felt a sense of relief. "Having TGP involved with DaVinci helped us to retain employees. When we announced the deal, it really calmed everyone down and allowed us to focus our energy on the sales channel development and we held on to key people. It was a big motivator for them to stay with us," explains Rosewall.

With no developed sales channels and a fragile distribution system prior to the investment, ("We actually had sales people calling individual homeowners, running samples to their homes and then trying to deliver the product," says Rosewall), DaVinci's team then created the DaVinci Masterpiece Contractors program to identify contractors who work with higher end home builders and home owners. Once they join the program, they receive sales literature, roofing tile sample boards, training for their installers and cooperative advertising dollars. "It's a pull strategy, rather than a push sales strategy," says Rosewall. "We can't afford to have pallets of tiles sitting in a warehouse, so we help our DaVinci Masterpiece Contractors create demand in the field for the product, not the other way around."

Recognized as an innovator in the roofing industry (DaVinci has won numerous product of the year awards), the company's roofing tiles are 100% recyclable with a 50 year warranty. Rosewall explains that DaVinci will continue to pioneer new designs and product upgrades. DaVinci also holds multiple patents on many of the designs including the newest product, Bellaforteā„¢, a snap fit self-aligning roof system that uses 30% less material which lowers the cost to the homeowner. The tile also features the company's industry-leading qualities in terms of wind and impact resistance along with fire retardance.

DaVinci has also been honored with the New Product of the Year award from Home and Garden Television (HGTV) and was a runner-up in the Cool Products Competition held this year by the Pacific Coast Builders Conference (PCBC). DaVinci products will also be featured in the Weather Channel's television special Weather Proof, a show that focuses and tests new products. The upcoming episode will test DaVinci's roofing tiles for resistance to impact, fire, water and simulations with wildfires, hurricanes and other weather-related events.

Rosewall is looking forward to being able to make additional investments in new equipment including new molds for increased tile production. "These are sizable capital expenditures, one machine could have a price tag of $1 million. We couldn't expand like this without help from TGP and the board," says Rosewall. "While other business owners are focused on surviving, we're focused on thriving."