Though a history of successful early-stage ventures precedes them, South Dakota Equity Partners (SDEP) proves its versatility with a local growth equity investment, GenPro Energy Solutions.
A energy services company headquartered in Piedmont, South Dakota, GenPro is a prime example of the type of high-growth business in which SDEP likes to invest. Founded in 2003, at a time when people were beginning to question their dependence on non-renewable resources, the company has reached impressive milestones over the last few years, and it sought additional equity to support that continued growth.
GenPro was recently featured on a list of 2019’s Top Engineering, Procurement and Construction (EPC) Companies in the Solar Industry by Solar Power World magazine. Other leading EPC companies include Mortenson and Black & Veatch.
In an effort to propel and sustain that growth, GenPro fostered a relationship with SDEP. GenPro’s CEO, Dwight Patterson, met SDEP partner, Blaine Crissman through a mutual connection in California.
“We were both shocked that we hadn’t met yet, being in the same state,” Patterson said. “I didn’t think we had those kind of resources within South Dakota, so meeting Blaine by way of California was a big eye-opener for us. We’re very pleased we were able to find a partner with South Dakota values to move forward in our organization.”
For Crissman, GenPro was a natural fit for SDEP. He emphasized the strength of its founders, Patterson and Jeremy Anderson, and the team they’ve built.
“They’re really bright guys who have a vision they’ve been executing on to grow the business,” Crissman said. “And just as importantly, they’ve built a strong management team around them.”
Beyond the quality of GenPro’s team, working with solar as an alternative energy source is compelling at a time when it’s proven to be cost-competitive. Patterson says the company is built around creating solutions that are both environmentally and economically sustainable.
At its outset, GenPro focused on the distribution of solar water pumping systems throughout the United States, but as Patterson and Anderson watched the industry evolve, their focus expanded to include both the design and implementation of the products.
Crissman emphasized the differentiating capabilities that GenPro has developed in engineering, procurement, and construction of utility-scale solar projects, as well as energy efficiency and an ability to successfully complete large-scale projects.
“They have a great reputation and are solar industry experts with reach both nationally and internationally but headquartered in South Dakota,” he said.
According to Patterson, prior to the last decade, renewable energy has primarily grown on the east and west coasts.
“To be able to be in South Dakota and have a successful renewable energy company deliver our skills and services throughout the United States is very rewarding for GenPro employees and will be for South Dakota Equity, as well,” Patterson said. “Knowing that we have such an impact, not only on the region but on a national level––it’s exciting to be part of an organization with that kind of reach.”
All of these qualities make the partnership between SDEP and GenPro a powerful one.
SDEP provides value beyond financing
Beyond patient growth equity, Crissman highlights the value SDEP provides its companies, including assisting management with strategic planning, financial analysis, and recruitment.
Involvement at the board level has included everything from new product development to negotiating acquisitions. On the investment side, impediments to a company’s growth often include a lack of ability to finance new products or hire new talent.
“When we’re investing growth equity, it’s typically companies that have reached profitability and are continuing to grow,” Crissman explained. “Our investment and involvement can supplement cash flow to accelerate growth.”
SDEP offers flexible structuring, and they do not require majority ownership in a company. Their equity is patient and long-term, and Crissman says the value provided beyond that initial investment is key.
“The relationships that South Dakota Equity has throughout the financial sector are very valuable to GenPro,” Patterson said. “They bring a whole host of relationships and knowledge to the team that we have assembled. As we go forward, we’re leaning on them to share that expertise.”
Crissman and his fellow partners have also operated in the role of CEO previously, allowing them to bring an understanding of the management perspective to their companies, in addition to financing.
“The job of CEO or President is difficult. The Partners of SDEP have all held management roles in operating companies. This gives us a unique perspective when we work with the management teams of our portfolio companies,” Crissman said. “We’ve led companies in rapidly-changing environments so we can relate to the challenges of corporate leadership.”
For rapidly-growing companies seeking either early-stage investment or growth equity, SDEP offers institutional capital and over 20 years of experience investing in private companies. If you feel your company may be a good fit, reach out to Blaine Crissman for more information at bcrissman@southdakotaequity.com.