Forest Hills Capital works with private investors who desire higher active returns, but do not have the time and resources to individually source private investments in the lower middle market. Central to Forest Hills Capital’s relationship with private investors is their desire to have active involvement in the management and operations of the invested company. This contrasts with the passive nature of traditional over-the-counter investments such as publicly-traded stocks, bonds, and mutual funds. Any investor with an ownership stake of less than 5% of a publicly-traded company has fundamentally very little influence over the way the company is operated. Even those individuals who own 5% or more merely have some influence: they do not have any direct control over how that company is run.
Active investment is typically that investment to which investors not only contribute funds, but also have limited to full control over how those funds are allocated and, in the case of private equity, how the acquired firm is operated. Most lower middle market private businesses are firms that are owned, controlled, and operated by one to several individuals. Because of this, investments in these sorts of companies can be classified as active in nature, and therefore, known as active investment. Forest Hills Capital Management primarily pursues ventures conducive to active management due to the increased involvement and influence such investments afford. These sorts of ventures allow Forest Hills Capital to utilize its core human capital competencies and strong network of contacts to help acquired companies achieve substantial growth.
If you are an accredited investor and want more information about investing in lower middle market businesses on an active basis with Forest Hills Capital to get a higher active return, contact us.