Joe E. Taylor Jr. spent nearly five years selling the state of South Carolina to businesses.
Now, he's stepping back in the spotlight, only this time he's in the market to buy.
Taylor, who helped recruit the Boeing 787 assembly plant to North Charleston while serving as head of the S.C. Commerce Department from 2006-11, is launching one of the few South Carolina-based private equity firms that also focuses on promising growth companies in the state.
"This is something I've thought about for a long time," Taylor said Thursday.
The new venture is called Southland Capital Partners. Based in the Columbia area, the former state commerce secretary's partners include businessman Donald R. Tomlin Jr. and attorney and investment banker Daniel D'Alberto, who said the upstart is aiming to bring "smart capital, financial as well as intellectual, so the companies can realize their growth potential."
John Dolan, an equity analyst and portfolio manager, will be affiliated with the firm to help raise funds from well-to-do investors on Wall Street and in Boston.
"Currently, private equity activity in South Carolina is very limited," Taylor said. "We want to look at the opportunities to acquire companies that we have right in front of us."
Southland Capital plans to use its own grubstake and cash from other private investors to buy companies with "serious" growth prospects and annual revenue between $5 million and $50 million. In a break from the traditional private equity model, it'll consider financing a start-up or two, but only if "the opportunity is right and the commitment from the entrepreneur is there."
Taylor has more than a passing familiarity with the industry he's plunging into. He twice sold the $60 million-a-year Irmo-based manufacturing business that he and his late father built, Southland Log Homes, with private equity money - once in 1999 (he stayed on as CEO) and again in 2005.
The Columbia native and 1980 Wofford College graduate said he has maintained and built on those connections.
"I've been fortunate enough to have stayed involved with various people from around the country and to have done some co-investing with them," he said.
Taylor noted that neighboring Georgia and North Carolina have rightly attracted their share of private equity shops on the backs of their big money centers in Atlanta and Charlotte. He believes the "time is right" to set one up to target overlooked businesses in the Palmetto State, especially now that the economy is "back to par."
"I think we are finding ourselves in South Carolina in a unique place where we really have some outstanding companies here ... and where the ownership is maturing where there may be some need to diversify," Taylor said. "It's amazing how many people build these companies up and how the entrepreneurs are so focused on reinvesting every dime back into their businesses that it becomes 100 percent of their net worth. There comes a time to grow off other people's capital for a change."
Taylor also hopes to harness the immense executive wealth that's steadily migrating to South Carolina's well-heeled second-home and retirement destinations, from Kiawah Island to Lake Keowee and Hilton Head.
"We have seen time and again that investors outside this region have a strong desire to invest in the Southeast, but no real connection to this market. Southland Capital will provide that connection," Taylor said.
Appointed by then-Gov. Mark Sanford in 2006, Taylor oversaw the state Commerce Department in the thick of the longest and deepest economic downturn since the Great Depression. He returned to private life in early 2011, when the Haley administration took office. He has mostly flown under the radar for the past three years, aside from being appointed to the board of the State Infrastructure Bank.
"We went full speed for five years in a pretty tough economic time," Taylor said. "It took a while to get caught up on all the personal stuff I hadn't managed when I was commerce secretary."
Taylor didn't have any acquisitions to announce last week. Instead, he dusted off an old saw he liked to use as commerce secretary, when he was selling South Carolina to businesses.
"We have some opportunities in the pipeline," he said.
Contact John McDermott at 937-5572.
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