Investment Philosophy: The Mitchell Group (MG) seeks companies in which its management can add value beyond just financial investment, often by taking an active role and working alongside team-based management to build stronger companies. The belief is that a company's management should be aligned with its investors to create and grow value through shared vision, innovation, and execution of its business plan.
The Mitchell Group uses a "managed entrepreneurship" concept. After the vision, strategy and business plan is determined, MG empowers the company's management to execute the day-to-day operations. With acquired businesses, MG's focus is on the initial investment strategy , not a predetermined exit event, to ensure solid returns to its investors with a longterm outlook.
Investment Criteria: The Mitchell Group (MG) seeks a diverse portfolio of companies, investment stage and industry. Depending on investment stage and risk profile, MG prefers to initially invest between $1 million and $10 million, and is able to be the lead investor or co-investor in deals ranging from $10 million to $50 million.
MG often prefers to hold a significant ownership in portfolio companies and will typically have representation on the Board of Directors that reflects its ownership. Therefore, MG expects to spend significant time and resources evaluating each of its investment opportunities and will generally seek investments which have the following set of preferred attributes:
• Employs an experienced management team having direct ownership in the company
• Controls a defensible breakthrough or enabling technology that has risk-adjusted potential for above-market returns on investment or other targeted benefits
• Delivers products or services to large stable markets with sustainable growth rates
• Exhibits potential for gains in productivity, cost reductions, and market expansions
• Ability to distribute predictable cash flow to investors
The term “vertigration” derives from vertical integration, a management control style and strategy in business operations that the Mitchell Group strongly believes in when looking for new business opportunities. MG adopted this approach early on by applying this concept through Riata Energy Inc. to the energy industry. By layering exploration, production, and oil field services under one company, MG is able to achieve economies of scale, drive costs down and increase profits for investors.
This concept is currently being carried out by The Mitchell Group’s investments on a global scale. The energy sector has extended to renewables and refineries as well to complete vertigration at a downstream level. It is also being applied to The Mitchell Group’s consumer investments. Specifically regarding the food industry in Brazil, it is being used to work towards a “pasture to plate” model.
Vertigration and Managed Entrepreneurship
In addition to the managed entrepreneurship concept regarding its relationship with company investments, The Mitchell Group has applied vertigration principles by the establishment of Riata Corporate Group (Riata CG). Riata CG was created to streamline the overheard services needed for each investment. When a company partners with The Mitchell Group, it already has legal, accounting, treasury, and payroll services at its disposal. Riata CG decreases the financial and audit risk to investors, provides consistent quality and service, and is able to give the economies of scale of a large company to smaller investments.
Riata Corporate Group was established to provide management services for the Mitchell Group’s investment Companies. The management services comprise of legal and regulatory, accounting, administration, business development, marketing, and information technology. At present, these Companies operate both domestically and internationally and are positioned in North America, South America, Turkey and Eastern Europe.