Private equity firm Cimbria Capital launches consulting arm
Houston-based private equity (PE) firm has launched a consulting arm focused on agriculture, water, and renewable energy – the specialized areas of the parent PE firm. The consulting arm will give synergistic capabilities to Cimbria Capital, while answering growing demand for managerial, operational, and technological advisory expertise in the accelerating agriculture, water, and renewables industries.
Private equity is booming, with the number of PE funds reaching 2,296 in early 2018 – a record high. According to the Boston Consulting Group, private equity funds sought to raise $744 billion, a 25% increase since a year earlier. Driven by low interest rates and historically attractive long-term returns, the private equity industry has swollen to record size. The spectacular growth has led to warnings that PE is an asset bubble, with conditions resembling those of the years before the 2008 financial crisis.
Cimbria Capital is a PE investment firm riding the wave of PE popularity and the increasing importance of the agriculture, renewable energy, and water industries – areas on which it focuses. Rising populations, climate change, and other factors are heightening the value and importance of companies in the above areas. Founded in 2014, the firm is headquartered in Houston, and recently opened a satellite office in Milwaukee – a hub for water industry firms.
The firm has now announced the launch of a management, scientific, and technical consulting arm – Cimbria Consulting. The new consultancy will offer ‘transformation-focused consulting services to enterprises in agribusiness, renewable energy, and water technology,’ and will be comprised of a ‘diverse group of highly skilled, global, and senior-level consultants.’ The new firm will be an affiliate company of Cimbria Capital.
The move is a logical step for Cimbria. When a private equity firm invests in a company, they already have to apply strategy, operational improvement, and other consultant-like skills to execute growth strategy and reorganization. By having these capabilities in-house, PE firms can rely less on external providers for their performance improvement agenda. They can also chase the lucrative fees and demand for management consulting services in the growing agribusiness, water, and renewables sectors.
"The establishment of Cimbria Consulting is a natural progression of Cimbria's overall mission to create value in — and benefit from — agriculture, water, and renewable energy, all fundamental industries needing to transform and expand," commented Brian V. Iversen, Founder of Cimbria Capital and Cimbria Consulting. "We are very excited about Cimbria Consulting's powerful business model as a stand-alone endeavor, but we also look forward to the inevitable synergies available between our new consulting platform and Cimbria Capital as a private equity investor."
The consulting firm will provide the trio of industries with tailored solutions that ensure efficient business models and market competitiveness – integrating emerging technologies, marketing and sales, and operational efficiencies. Barry Mattson will serve as the consultancy’s Managing Director, helming a team of almost 50 professionals.
Commenting on the launch, Cimbria Capital Director Noah J. Sabich said, "I am humbled by the in-depth expertise possessed by the consultants on our new team, and I am eager to see how the skill sets of the soon-to-be 50 person team of senior consultants will accelerate constructive advancements in our core sectors."
"The value they can bring to companies solving essential food, energy, and water issues is astounding, and the team's wide-ranging capabilities and geographic locations also means Cimbria's overall insight into rising markets and opportunities will continue to progress," added Sabich, who will also serve as a Senior Advisor at Cimbria Consulting.
