Galileo Capital Management has launched LGBT Capital, a corporate advisory and investment management unit focused on the LGBT (lesbian, gay, bisexual and transgender) consumer market.
LGBT Capital provides corporate advisory and business development services for companies that serve the LGBT consumer sector.
In addition, LGBT Capital is preparing to launch a fund that will invest in companies worldwide that provide products and services to the LGBT community.
LGBT Capital believes that as LGBT freedoms continue to develop, growing LGBT companies will increasingly look to raise capital, merge and acquire, which will require specialist advice and capital raising options.
LGBT Capital has met with a significant number of LGBT business owners and managers and found that many plans do not come to fruition due to the lack of professional business development advice available and the shortage of advice on how to access external investors. This is partly because many LGBT-oriented companies were originally established with a degree of secrecy and without the financial support otherwise available to start-up companies.
“LGBT-oriented business owners often have the desire to expand but also frequently lack the expertise, correct capital structure or know–how to access funding,” says Paul Thompson, co-founder of LGBT Capital. “We believe there is a significant opportunity to provide the financial expertise typically found within an investment banking context to LGBT companies, which in turn would allow quality companies to secure funding.”
A survey commissioned by Galileo Capital Management in December 2009 and carried out by Iliad, the LGBT business networking organisation, found that 80 per cent of LGBT companies believe there is insufficient specialist advice on capital raising and structure as well as M&A.
The survey highlights significant suppressed and unmet demand for investment banking and business development advisory services to LGBT companies. Of the respondents, 80 per cent of LGBT companies require capital for expansion, 100 per cent of LGBT companies have expansion plans including expansion outside of their current scope/geography and 100 per cent of LGBT companies would consider mergers, acquisition and third party investment.
The survey also found 100 per cent of potential investors in LGBT companies did not proceed with their investments, with 80 per cent citing inadequate funding and capital structure as the main reason.
LGBT Capital’s principals Anders Jacobsen and Paul Thompson have over 40 years combined experience in the investment management sector with track records in global investment managers including Goldman Sachs, Prudential Financial, Bankers Trust and Chase Manhattan Bank as well as a unique knowledge of the LGBT sector. Between them they have advised numerous mutual, private equity, venture capital and hedge funds on their establishment and launch, as well as provided growth and development strategies for existing investment funds.
LGBT Capital has operations in Europe and Greater China and a team of advisers with global coverage.
