Other

Middle-market-focused McCarthy Capital has rebranded as M-One Capital. The Omaha-based firm’s new name reflects its ongoing focus on backing founder- and management-led businesses, while signaling a broader investment approach across sectors and regions.

McCarthy Capital was founded in 1986 as a fundless sponsor, making majority and minority investments of less than $10 million in smaller, regional companies. It has evolved into an institutional platform with a broader investment approach across sectors and regions.

Today, M-One Capital is investing from its latest private equity fund, M-One Capital Fund VIII LP, with $870 million of capital commitments. Within private equity, M-One invests between $30 million and $125 million in either majority or minority positions, typically in companies with more than $10 million in revenue where existing leadership retains operating control and an equity ownership position. Earlier funds under the McCarthy name included McCarthy Capital Fund VII LP with $535 million of capital (2020) and McCarthy Capital Fund VI LP with $353 million of capital (2016).

M-One also makes growth equity investments of $5 million to $20 million in companies with at least $1 million in recurring revenue. In addition, the firm has a real estate strategy that invests from $3 million to $35 million across a range of real estate asset types and markets.

Since its founding as McCarthy Capital, and including M-One investments, the firm has invested in over eighty companies, including Cabela’s, the specialty outdoor retailer; Guild Mortgage Company, a national mortgage lender; Peak 10, a data center and managed IT services firm now merged as Flexential; Vornado Air, a household name in air circulators and heaters; Medical Solutions, a leading travel nurse staffing provider; Omaha Steaks, the well-known food and steak delivery brand; and Signal 88 Security, a major franchisor of security services in North America.

More recent transactions include growth partnerships with NUSO, a cloud communications provider, and strategic exits such as BiggerPockets, an online real estate investor platform, as well as Blue Sky eLearn, Honey Smoked Fish, and Life Care Services. These transactions highlight the firm’s breadth across the consumer, healthcare, and business services sectors.

The rebranding to M-One formalizes changes that have taken shape over the past decade as the firm increased its scale, diversified its investment activity, and deepened its organizational resources.

“Our rebranding honors our legacy and reflects the significant evolution we’ve experienced over the past decade,” said Patrick Duffy, the president and managing partner of M-One Capital. “M-One Capital represents our expanded scale, strategic growth and unwavering commitment to integrity, rigor, relationships and results. While our new brand better aligns with our current organization, we remain focused on our mission of being a value-added partner to entrepreneurs and families in an effort to drive long-term growth and success.”

Today, M-One Capital has more than $4 billion in capital under management and is based in Omaha, with an additional office near Boston in Wellesley, Massachusetts.

© 2025 Private Equity Professional | September 23, 2025

Over the years, private equity has shifted from a focus on leverage and financial engineering to an ever-increasing emphasis on creating value through operational improvements within their portfolio companies. This shift includes enhancing management practices, investing in technology upgrades, and creating new sources of revenue.

As market conditions grow more competitive and complex, the ability to drive value through operational improvements has become a key differentiator in achieving superior investment returns.

In many ways, creating value is a more difficult path. It means working with portfolio management to refine their product or service focus, streamline operating processes, align management performance systems, and change fundamental behaviors of both managers and employees.

Here, operational optimization experts across several unique sectors outline where value can be found and identify ways to unlock it.

MANUFACTURING & CONSTRUCTION
In the current environment, leadership is increasingly being pressured to react to market turbulence. One significant result of that is that we’re seeing a heightened need for a project management framework.

Corporate objectives and strategies are being created all the time. But having strategies in play without any path forward can be a detriment. A well-structured Project Management Office (PMO) and a framework that overlays the facilitation of the work is a key ingredient that drives implementation, ultimately providing rapid and sustainable ROI.

Defining the right expectations, milestones, and timelines is important, but, because time is money, managing them closely to an outcome is critical.

Our team of consultants recently helped a global service provider to develop a framework for the management of internal improvement projects. Multiple mergers and acquisitions had created operational inconsistencies within the business. These inconsistencies, coupled with rising interest rates, created pressure on the organization’s leaders to rapidly reduce costs and streamline processes. The first nine months of our initiative produced significant improvements in process alignment, planning, and execution, resulting in more than $15 million in annualized savings.

HEALTHCARE
Private equity firms that are invested in or are looking to expand a healthcare rollup will often struggle to integrate best practices and standardize execution. This leaves valuable margin dollars on the table. Firms are often working with technical experts, such as physician-owned businesses, where resistance to standardization is common. There is an added complexity in that the operations are dealing with people’s lives. There are many risks and operational challenges surrounding this type of business.

It is in this space that operational management experts are able to create a thoughtful operating model that can be used to not only to compare performance across the network but create a useful blueprint for additional acquisitions.

After adopting the new operating model, the network realized a 27% increase in productivity, 10% improvement in capacity,
and a 24% improvement in patient access.

A leading healthcare network, for example, wanted to improve performance and patient access across multiple outpatient facilities to provide growth opportunity and understand asset capacity and utilization. Upon analysis, our consultants discovered that key assets were underutilized by more than 50%, appointment wait times were exaggerated due to scheduling deficiencies, and planned procedure times were not aligned with actual procedure times. Significant rework was also created by disconnects between key departments.

To address these challenges, operational management experts created a comprehensive operating model to improve visibility to key drivers of capacity and utilization while increasing access for patients. The implementation of this model focused on aligning procedures across clinics, with a strong emphasis on communication and training to ensure buy-in from all staff.

After adopting the new operating model, the network realized a 27% increase in productivity, 10% improvement in capacity, and a 24% improvement in patient access. Patient satisfaction scores improved, indicating a more consistent experience and enhanced quality of care.

This example demonstrates how a thoughtful and collaborative approach to standardization can bridge the gap between numbers-driven objectives and patient-centered care, ultimately leading to better financial and operational outcomes. Alignment and adoption among facilities, locations, or environments is a critical piece of that puzzle, and communication is integral to this.

FINANCIAL SERVICES
Financial service organizations, such as insurance companies and credit unions, are fundamentally about customer service. Success often hinges on whether customers feel supported and understood. While local staff often go above and beyond to provide excellent service, this dedication can lead to inconsistent practices across different branches, making it difficult for corporate offices to standardize processes and measure performance accurately.

To resolve these disparities and enhance overall service quality, it’s essential to establish clear, organization-wide standards for customer service, processes, and systems. This involves defining best practices, standardizing operations while minimizing unnecessary variations, and implementing a robust system of metrics and regular follow-ups. By focusing on aligning customer service and operational goals across all branches, financial service companies can optimize their business as a whole, ensuring a more consistent and effective customer experience.

The operational transformation resulted in productivity improvements ranging from 7% to 57%, a reduction in labor cost averaging 14%,
and service level improvements of more than 17%.

One example of this can be seen in a large insurance provider with multiple branches that struggled to identify process optimization opportunities due to a highly variable knowledge-based work environment. Non-value added work and uneven workloads existed in many departments, and cultural barriers created obstacles to the development of consistent practices.

To address this issue, our team of consultants implemented a company-wide initiative to establish processes and workflows that increased productivity and reduced errors and duplication. This included customized, location-specific changes to maintain valid region differences as well as improved management operating system tools to track and respond to variances to plan.

The operational transformation resulted in productivity improvements ranging from 7% to 57%, a reduction in labor cost averaging 14%, and service level improvements of more than 17%.

This example illustrates how strategic standardization and process alignment can enhance service quality, leading to efficient operations and a more reliable positive customer experience across locations.

Private equity professionals increasingly recognize the importance of having a robust network of operational management experts to help drive operating cash flow. Operational experts bring specialized knowledge and hands-on experience that can significantly enhance the performance of portfolio companies and help build high performance management teams. They identify inefficiencies, streamline processes, and implement best practices that lead to sustainable growth and profitability.

For private equity firms, leveraging such expertise not only maximizes value creation but also provides a strategic advantage in navigating the intricacies of modern deal-making and post-acquisition integration.

About the Author:
Carl Valentino is a seasoned executive with over three decades of senior management experience in the private sector. He currently leads the Private Equity division at Carpedia International, a global consultancy specializing in the implementation of operational improvement. Throughout his career, Carl has collaborated with C-level executives across diverse industries, spearheading initiatives that drive revenue growth, optimize cost structures, and enhance working capital management. A proud graduate of Notre Dame, Carl resides in Atlanta, Georgia.

Carpedia International is a global operational improvement consultancy that partners with organizations across various industries to help them achieve sustainable performance enhancements. By focusing on aligning corporate strategy with day-to-day operations, Carpedia delivers customized solutions that drive measurable improvements in productivity, profitability, and organizational culture. The firm utilizes a hands-on approach, working closely with clients to identify inefficiencies, implement best practices, and ensure long-term success through continuous improvement and accountability.

For more information, visit www.carpedia.com.

© 2024 Private Equity Professional | November 22, 2024

rivate equity general partners (GPs) are incredibly busy, although M&A volume might suggest sponsors aren’t as active as they were in 2021 and 2022. Their focus, however, has been on efforts to accelerate and enhance value creation within their existing portfolios.

The data bears this out. For one, the median hold period at exit continues to stretch longer, according to Pitchbook, and exceeded seven years based on exits completed in 2023. Moreover, the proportion of add-on acquisitions as a percentage of total investment activity reached 75%, and the volume of add-ons in the first half of 2024 was easily on pace to eclipse last year’s total, according to data from Pitchbook.

The market, to be sure, is a factor, but sponsors have shown they are willing to extend hold periods if they can continue to drive value from their best investments, and add-ons are increasingly becoming a key ingredient in the private equity playbook.

None of this should come as a surprise, as sponsors are increasingly looking inward to find conviction. While the economic and geopolitical backdrop play a role, another contributing factor is that GPs have never before had so many tools at their disposal to extend the growth runways of their existing investments or navigate the obstacles that often get in the way. In this sense, strategic capital solutions are facilitating mid-hold value creation efforts that 10 or even five years ago were not always available.

Strategic capital can solve complex challenges that would have
otherwise prevented the sponsor from taking advantage
of potential upside opportunities.

Consider, for instance, the roadblocks most sponsors would historically encounter that would limit the extent to which they could re-invest in existing portfolio companies. These might include concentration limits that require LPAC approval; dwindling fund reserves that might restrict a sponsor’s ability to commit more equity; or co-investors with different motivations, investment timelines, or objectives. A traditional secondaries solution or a single-asset continuation fund might provide some relief, but in a capital constrained, difficult fundraising environment, these alternatives offer little certainty and can take a year or longer to arrange and structure.

Enter strategic capital. To be sure, as the market develops, this can still mean different things to different people and currently represents a very large tent that contains sometimes vastly different strategies — from NAV loans to growth capital and a lot of things in between. At ASC, we think of strategic capital as investments in seasoned situations, or mid-hold equity solutions, where we can bring speed and flexibility to bear in building equity value. Our solutions seek to facilitate M&A or organic growth initiatives, cross-fund investments, shareholder consolidation, or other similar initiatives.

While many strategic capital providers pursue a specialization or niche, one common thread is that, by design, the value proposition rests in the flexibility afforded to GPs. For instance, some strategies may be focused on providing liquidity solutions, whereas others are geared for distressed situations. ASC’s specific mandate is centered on minority, non-control investments — alongside existing private equity sponsors — to facilitate tangible opportunities for predictable value creation within their portfolios. Said another way, mid-hold strategies are premised on helping GPs capitalize on the work they’ve already put into their portfolio companies to drive further equity value in the business.

MID-HOLD EQUITY IN ACTION
To appreciate the flexibility, it can help to understand the types of investments these strategies facilitate. For instance, in one transaction last year, ASC invested preferred equity into a private equity-backed business services company that used the capital to complete a priority acquisition. This opened up a new end market, extended the company’s product suite, and unlocked cross-selling opportunities that are driving new channels of organic growth. Audax invested alongside the existing sponsor, which had owned the company for several years, and invested new capital into the business.

In another example, in the education space, ASC’s common equity investment facilitated a transaction that allowed the existing sponsor to invest fresh capital into the company through its new fund, while bringing on a co-control investment partner. The ASC investment, beyond allowing the sponsor to maintain joint control, included an unfunded equity commitment for future M&A.

And in Europe, in an investment in the business services sector, ASC’s common equity equipped the sponsor to execute on an attractive and actionable pipeline of M&A opportunities that can drive product line expansion and geographic growth.

The connection across these investments, beyond the flexibility required, is that ASC is backing strong, performing PE-backed companies seeking to pursue another phase of growth. In each case, too, the investment solved a complex challenge that would have otherwise prevented the sponsor from taking advantage of potential upside opportunities.

As valuations remain historically high, sponsors aren’t generally
counting on multiple expansion unless they’re able
to materially drive top- and bottom-line growth.

Each of the investments also leveraged Audax’ history and track record executing its Buy & Build playbook that brought to bear speed and decisiveness for the sponsor to capitalize on opportunities that could otherwise be fleeting.

Not every investment, however, will necessarily be premised on a specific add-on. In some cases, it can be about re-aligning interests to try to push forward growth strategies already in place. In these situations, the capital is dedicated to clearing a path for M&A and growth opportunities, versus being channeled directly into new transactions.

For instance, in one case, ASC supported a dental support organization through a convertible preferred investment. The investment was premised on helping the sponsor maintain the company’s de novo and M&A growth momentum entering the sixth year of its hold period.

A STRATEGY FOR ANY MARKET
The value proposition of mid-hold equity, generally, is to provide another tool that allows sponsors to drive long-term growth and draw on private equity’s role as a provider of truly patient capital. And while an accommodating monetary policy in the years between the great financial crisis and the end of the pandemic may have fueled an accelerated exit environment, marked by shorter hold periods and elevated IRRs, a higher-for-longer- interest-rate environment, even as the Fed adopts a more dovish stance, is seeing sponsors drill into value creation as the primary driver of returns.

This focus on value creation is also informing new investment decisions, as valuations remain historically high. This means sponsors aren’t generally counting on multiple expansion unless they’re able to materially drive top- and bottom-line growth. As such, many are underwriting their investments with longer hold periods in mind.

Another factor that supports the maturation of strategic capital generally — and the mid-hold equity segment more specifically — is that while financial engineering as a sole driver of returns may be a thing of the past, sponsors are increasingly building out their internal capital markets functions to bring deep proficiency and expertise to fund ambitious theses centered around value creation. And as more sponsors adopt Buy & Build strategies trying to effect organic and inorganic growth, they will require sophisticated tools to engender the financial flexibility required. Mid-hold equity solutions, in this sense, are a way to meet the needs of today’s sponsors in looking to drive long-term value.

While dislocated financing markets and interest rate volatility may accentuate the need for flexible capital solutions, we believe the recent growth of the segment is untethered to the current economic and market backdrop. Instead, it speaks to the evolution of the larger private capital asset class in which sponsors are seeking predictable paths for value creation and want to continue to invest behind the winners in their portfolios.

— End —

About the Authors
Husain Kumber is a Managing Director for Audax Strategic Capital, focused on providing various capital solutions to companies owned by private equity sponsors. Prior to joining Audax in 2022, Mr. Kumber was Managing Director, Head of Americas, for DWS Private Equity and previously worked at Morgan Stanley Alternative Investment Partners, WP Global Partners, and Swiss Re. Mr. Kumber’s experience spans private equity secondaries, co-investments and fund commitments, with the majority of investments being made into concentrated and customized secondary transactions.

Daniel Green is a Managing Director for Audax Strategic Capital, focused on providing various capital solutions to companies owned by private equity sponsors. Prior to joining Audax in 2022, Daniel was Managing Director, Head of Europe, for DWS Private Equity with responsibility for the activities of the business in EMEA. He also previously worked as a Senior Director at Meketa Investment Group where he led EMEA investment activities across private equity and real assets. Daniel spent 13 years with Greenpark Capital, a UK-headquartered secondaries private equity fund manager with $2 billion of commitments, rising to the position of Chief Investment Officer.

Based in New York and London, Audax Strategic Capital (ASC) is a flexible partner to private equity sponsors seeking customized equity solutions to drive continued growth at their portfolio companies. ASC’s capital solutions support add-on acquisitions and organic growth initiatives through bespoke structures that enable PE sponsors to maintain continued control and ownership of performing assets while ensuring interests remain aligned in pursuit of future growth. ASC is part of the Audax Private Equity platform, a capital partner to middle market companies with $19 billion of assets under management, over 270 employees, and 100-plus investment professionals.

DISCLOSURES
The information herein has been prepared solely for informational purposes. Certain statements constitute “forward-looking statements” that can be identified by the use of forward-looking terminology such as “may,” “will,” ”should,” “expect,” “anticipate,” “estimate,” “intend,” “continue,” or “believe” or comparable terminology. Due to various risks and uncertainties, actual events or results may differ materially from those reflected in such forward-looking statements. Opinions expressed reflect the current opinions of Audax Strategic Capital (ASC) as of November, 2024 only and are based on ASC’s opinions of the current market environment, which is subject to change. Certain information contained herein may be based on or obtained or derived from data published or prepared by other parties. While such sources are believed to be reliable, ASC does not assume any responsibility for the accuracy of any third-party information.

he intersection of private equity (PE) and healthcare presents unique opportunities and challenges. Aligning the goals of financial performance and patient care excellence is critical to the success of any post-acquisition strategy. However, these goals may initially present as opposing priorities. The key to creating an environment that supports both individualized patient care and financial success lies in a third component, one that serves to bridge the gap – operational consistency.

Incorporating a consistent care model into the operating strategy of a healthcare organization serves as a critical third pillar in the triad that comprises a successful platform: operational efficiency, clinical excellence, and enhanced financial performance.

Variability as an Opportunity
When pursuing a healthcare rollup strategy, variability within operations can present substantial opportunity. Variability can come in many forms, including:

•  Variability in processes or workflows
•  Variability in work performance due to training gaps or personnel issues
•  Variability in technology
•  Variability in staffing methodologies and ratios

While not always negative, these variabilities often lead to differences in performance, cost, quality, and consistency of care. It makes businesses more difficult to predict and manage. Private equity firms can unlock significant value by addressing this variability, improving EBITDA while simultaneously enhancing the quality and consistency of care. This dual benefit can elevate the healthcare organization, enrich patient outcomes, and bolster financial performance.

PE firms and clinical stakeholders often face challenges in achieving consistent margins and EBITDA across different locations.

A consistent care model presents a systematic approach designed to ensure that patients receive continuous, coordinated, and comprehensive care throughout their healthcare journey. Consistency in care often translates to better EBITDA while simultaneously yielding favorable patient outcomes. Studies have correlated consistent care models with reduced hospital readmission rates and improved management of chronic diseases such as diabetes. Patients who experience consistent care also report significantly higher satisfaction rates compared to those without consistent care pathways.

The Missing Piece
PE firms looking to expand existing healthcare platforms may face resistance from physician-owned businesses where standardization is not the norm. The high stakes involved in healthcare add layers of complexity and risk. While private equity firms bring financial expertise and clinical stakeholders bring clinical expertise, a critical component of operational expertise is often missing from this collaboration.

Operational transformations or operating models that focus on identifying and implementing best practices consistently, where appropriate, bridge the gap between financial and clinical expertise. Consistent operating models generally lead to improved predictability in financial performance by identifying and socializing the best methods of delivering various types of care using a cross-functional / cross-location approach.

Operational efficiency helps facilitate an environment where healthcare providers can deliver more personalized care.

PE firms and clinical stakeholders often face challenges in achieving consistent margins and EBITDA across different locations. To address these discrepancies, external operational experts are often called upon. By analyzing performance across networks, independent consultants can develop models to identify areas for improvement and inform strategic decisions, such as additional acquisitions.

Bridging the gap between financial goals and patient care is essential for long-term success. Effective collaboration between PE firms, healthcare providers, and operational experts is crucial for optimizing performance and driving sustainable growth. This synthesis enables a seamless integration of efficiency and empathy, ultimately fostering environments where financial health and human health thrive together.

Additional Strategies
Strategies for consistent care and operational efficiency also help healthcare organizations gain visibility into their asset capacity and utilization. This can improve performance and facilitate growth by increasing patient access to key services throughout the system.

A case study of a large healthcare network demonstrates the potential impact of these strategies. The network sought to expand through increased patient access to key services. An operational assessment revealed that essential assets were less than 50% utilized, scheduling practices led to exaggerated appointment wait times, and departments such as scheduling and care delivery were siloed, leading to significant rework. A transformation project successfully improved planning, scheduling, real-time reporting tools, and communication cadence, resulting in a 10% Improvement in average capacity, 18% Improvement in average utilization, 27% Improvement in productivity per labor hour, 8% Increase in volume, and a 24% reduction in average appointment lead days. These results reflect the potential for operational excellence to deliver improved asset utilization and increased access to care.

Incorporating Individualization
Improving operational efficiency through standardization of routine tasks enables healthcare providers to redirect their focus towards individualized patient care. Research shows that standardizing administrative and procedural tasks can improve operational efficiency, reduce errors, and create a more stable work environment. Operational efficiency helps facilitate an environment where healthcare providers can deliver more personalized care.

The value of a consistent care model increases exponentially when adopted across a healthcare portfolio or even more broadly across multi-industry portfolios.

Furthermore, the standardization framework itself is often not a one-size-fits-all approach. It typically involves creating operational archetypes or consistency within distinct groups tailored to specific clinic clusters. For PE firms, this combination of standardization and individualization enables performance comparisons across the portfolio and informs future acquisitions with clear performance expectations.

An example of this can be found in a project our firm implemented for Canada’s largest provider of community healthcare services. We established standardized procedures and reorganized management systems and teams to provide a new framework for better support. The project improved the Client Services operation, the part of the organization where community services are scheduled, customers are onboarded, and cases are managed. This department facilitates services at 20+ locations across five provinces and hundreds of communities. Prior to the transformation project, each location had different workflows, system setups, call tree designs, management structures, and leadership approaches. Standardization resulted in cost savings of approximately 20% without additional capital investment. These optimization opportunities closed performance gaps and demonstrated the potential of standardization strategies.

Expanding the Impact
The value of a consistent care model increases exponentially when adopted across a healthcare portfolio or even more broadly across multi-industry portfolios. It is important to note that this method is supplementary; it enhances value creation without replacing existing strategies. It allows for scalability across various sectors by focusing on operational excellence—an essential aspect of value creation in today’s environment. Additionally, consistency provides better portfolio reporting, aiding strategic decision-making.

Bridging the gap between private equity and healthcare through a consistent care model aligns financial objectives with patient care excellence, fostering a culture of continuous improvement and operational efficiency.

— End —

About the Authors
Emma Bambrick is a Director, Partner, and head of the Healthcare division at Carpedia International, a global operational improvement consultancy. Emma works with leaders to align their organization’s culture and behaviors, improve and implement their operational plan, and drive performance improvement. This work has led to long-standing client relationships and tens of millions of dollars in realized benefits.

Joe Koehler is a leader within Carpedia’s Private Equity Practice, known for his exceptional ability to build and nurture relationships with Private Equity firms and their portfolio companies across North America. Joe has held senior-level management positions in several financial services firms and is experienced in equity markets, financial communications, and ESG initiatives. His internal contributions have included developing new product and service offerings and enhancing operational strategies.

Carpedia International is a global operational improvement consultancy that partners with organizations across various industries to help them achieve sustainable performance enhancements. By focusing on aligning corporate strategy with day-to-day operations, Carpedia delivers customized solutions that drive measurable improvements in productivity, profitability, and organizational culture. The firm utilizes a hands-on approach, working closely with clients to identify inefficiencies, implement best practices, and ensure long-term success through continuous improvement and accountability.

For more information, visit www.carpedia.com.

© 2024 Private Equity Professional | October 9, 2024