$400 Million, 24 Deals, and No Fund to Answer To
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About this Episode
Private equity principals do not usually say this out loud. For years Edward Crawford and Ralph Manning sold good companies early, not because the market was right, but because they could not see far enough into their own businesses to know what was hiding. "We need to sell this company before something bad happens." Lane Carrick stops them cold: in a career on the sellside he has never heard anyone admit it.
Crawford and Manning co-founded Coltala Holdings in 2017 and have deployed more than $400 million across 24 transactions in aerospace and defense, home health, water, and real estate engineering. There is no fund behind it, so there is no seventh-year clock and no forced sale to raise the next one. What replaced the fear is a system they call the Coltala Enterprise System, with a lineage running through Danaher and the Toyota Production System by way of Larry Culp, who took Danaher's market cap from $3 billion to $30 billion and now runs GE.
The proof is their aerospace business. Lead times sat at 164 days, tying up cash and people. Two weeks of kaizen on three bottlenecks, one of them an $80,000 paint shop, brought it to 32 days. Every employee at every Coltala company, forklift operator and janitorial staff included, gets a quarterly check cut from 8 to 10 percent of after-tax profits.
They are blunt about who they are for: "If you want a guy from New York who has a Harvard MBA who's going to tell you how great they are, you can go work with them. But if you want a real partner, we're your guys." Thirty thousand newsletter subscribers and about a hundred deep relationships do the sourcing, and founders now call them to say they do not want traditional private equity. Then the last twenty minutes go somewhere else entirely, to Andrew Jackson walking the ground before the Battle of New Orleans, a Peace Corps coffee cooperative in a Dominican town called Los Blancos, and the banana peddler who overthrew a government and coined the phrase Banana Republic.
About Edward Crawford & Ralph Manning
Edward Crawford & Ralph Manning
Co-Founders & Co-CEOs, Coltala Holdings
Edward Crawford and Ralph Manning co-founded Coltala Holdings in 2017. The firm now owns operating companies across four essential-service lanes the partners describe as air, land, and water: aerospace and defense engineering and composite repair, home health, water well drilling, and real estate engineering consulting. It has deployed more than $400 million across 24 transactions and, unlike a traditional private equity fund, has no fixed life, no seventh-year exit clock, and no obligation to sell in order to raise a successor vehicle. Edward's path runs from the Peace Corps in the Dominican Republic, where he founded a coffee cooperative that grew past 300 farmers, through U.S. Naval Intelligence, including a deployment to Afghanistan as a tribal and political adviser attached to SEAL Teams 2 and 4 for which he received the Bronze Star, to a vice presidency at Goldman Sachs. He holds an MBA from MIT Sloan, is a founding member of the NYSE Texas advisory board, a Governor Abbott appointee to the Texas Product Development and Small Business Incubator Board, a Council on Foreign Relations term member, and a TEDx speaker on courageous service. Ralph has been acquiring majority control of lower-middle-market operating companies since 2003. He was a founding partner of Denver-based Progress Equity Partners, where the partnership completed more than 30 platform transactions and returned over $800 million in realized proceeds, and began his investing career in mezzanine and equity at RSTW Partners. He holds a BBA in finance and real estate from TCU, a graduate certificate in finance from SMU, and Harvard Business School OPM, and is a CFA charterholder. He sits on the boards of Choice Health at Home, Paschal Home Services, and Pond Robinson & Associates, and runs Whistlejacket Farm, the Arabian horse operation his family has kept in Texas since the 1960s. Ralph authored the Coltala Enterprise System, the firm's lean operating playbook, which traces to the Danaher Business System and the Toyota Production System.
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Book Recommendations
The Fish That Ate the Whale
by Rich Cohen
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What to Make of a Life
by Jim Collins
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Give and Take
by Adam Grant
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The 32 Principles
by Rener Gracie
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Unit X
by Raj Shah and Christopher Kirchhoff
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