In an insightful fireside chat hosted by Giovanni Amodeo, Justin Ryan, the co-founder and managing partner of Glow Capital Partners, delved into the intricacies of launching a first-time fund in the competitive landscape of capital markets. The discussion, rich with insights and personal anecdotes from Ryan’s extensive career, covered a broad spectrum of topics, from the initial steps of founding Glow to the future aspirations for the firm.

Launching Glow Capital Partners: A Journey Through Time

Justin Ryan’s journey into the world of private equity began in 1997 with Catalyst Investment Managers, an Australian private equity company. His career trajectory took him through significant roles, including running Alesco Corporation, a public ASX 200 listed industrial company, and a decade-long tenure at Quadrant before co-founding Glow Capital Partners with Kate Morris in 2022. The decision to launch Glow was driven by Ryan’s perception of a market gap and the opportunity to offer a differentiated product in a market characterized by high barriers to success.

The Challenges and Strategies of a First-Time Fund

Ryan candidly shared the challenges faced in launching a first-time fund, emphasizing the delicate process of timing and the importance of offering something unique to attract investor support. Glow aimed to raise between A$200 to A$300 million but ultimately raised a $90 million fund. Despite this, Ryan remains optimistic, viewing the fund size as sufficient to get started, with plans for a larger second fund based on the firm’s performance.

Investment Focus and Deal Flow

Glow’s investment strategy is centred on identifying and capitalizing on breakout growth opportunities within the small to medium enterprise sector in Australia. Ryan highlighted the firm’s commitment to proprietary deal flow, with over 700 deals reviewed and two investments made, both of which were proprietary in nature. This approach underscores Glow’s dedication to finding unique opportunities that others might overlook.

The Role of Technology and Future Outlook

Technology plays a crucial role in Glow’s operations, from using Salesforce as a CRM to exploring AI for identifying and screening potential investments. Ryan also touched on the evolving role of intermediaries in the investment landscape, suggesting that direct access to founders and entrepreneurs through platforms like LinkedIn could disrupt traditional intermediary roles.

Building a Team and Cultivating Talent

The importance of assembling a talented team was a recurring theme, with Ryan emphasizing the need for operational improvement skills and business re-engineering capabilities. Looking ahead, Ryan envisions Glow as a partnership, allowing for the inclusion of more senior talent and ensuring alignment of interests among team members.

Sustainability and ESG Commitments

As a B corporation, Glow is deeply committed to ESG principles, integrating sustainability targets into its operations and investment decisions. This commitment reflects the firm’s broader vision of not only achieving financial success but also making a positive impact on society and the environment.

A Vision for the Future

Ryan’s vision for Glow in the next 10 to 15 years is ambitious yet grounded in the firm’s foundational principles. He hopes to see Glow managing multiple funds, backed by a loyal group of investors, and having a track record of supporting successful businesses. The goal is to create an ecosystem of founders and businesses that continue to drive innovation and growth.

In summary, Justin Ryan’s fireside chat offered a comprehensive overview of the challenges and strategies involved in launching and growing a first-time fund. With a focus on proprietary deal flow, technology integration, and a strong commitment to ESG principles, Glow Capital Partners is poised to make a significant impact in the private equity space.

Key timestamps:

00:09: Introduction to ION Influencers’ Fireside Chats
00:33: Justin Ryan’s Background and Career
01:27: Challenges of Launching a First-Time Fund
02:44: Identifying Market Gap and Niche
03:50: Market Considerations for Growth Capital
05:16: Determining Fund Size and Investor Attraction
06:05: Perception of Fund Size from Investors’ Point of View
07:39: Fundraising Challenges and Institutional Investors’ Feedback
08:03: Challenges in the Australian Market and Institutional Investment
09:18: Pitching the Proposition for First-Time Funds
10:34: Challenges in Raising Funds and Building a Pipeline
11:42: Efforts in Generating Proprietary Deal Flow
13:58: Utilizing Technology in Deal Screening
14:40: The Role of Technology and Hard Work in Deal Sourcing
15:19: Using AI for Screening and Identifying Companies
17:07: Overview of Investment Ticket Sizes
18:32: Details of the First and Second Investments
19:02: Future Fundraising and Performance
20:49: Focus on Exit Strategy
22:58: Financing and Growth Strategy
24:36: Advantages of Niche Independent Private Equity
25:55: Building and Expanding the Team
28:12: Incentives and Sustainability
29:43: Sustainability and Future Outlook