Granite partnership Invests in

Rational Equity, LLC

Granite Equity Partners is pleased to announce an investment in Rational Equity, LLC, a search fund formed to acquire, operate and increase the value of a middle market software company.  Rational's "search" will focus on finding a profitable company with proven software systems that are provided to a broad customer base and that yield strong recurring service revenues.  Rational's investment criteria have strong overlap with Granite Equity.

This investment is the second investment made by Granite Equity in the search fund business model.  In its first fund, Granite invested in North Point Capital, a search fund which acquired Asset Recovery Corporation in St. Paul.  In the search fund model, the key executive focuses all efforts on locating an acquisition candidate to manage, with the investors' sponsorship.  In turn, the investors receive a step-up on their search fund investment upon completion of a target acquisition, as well as the right to their pro-rata ownership share of the acquired company. Granite Equity invested $45,000 in this "bet the jockey" strategy, joining Housatonic Partners, The Cambria Group, Alpine Investors, and KCA Partners as members of the investment team.

The Managing Partner of Rational Equity is Doug McGregor, an executive with over 25 years of technology business experience. Prior to Rational Equity, Doug led Global Mergers & Acquisitions within SoftBrands, Inc., a $100M public software company.  He built SoftBrands M&A practice from conception to over $30M in acquisitions within an 18-month period. Prior to SoftBrands, Mr. McGregor was Global Vice President/General Manager for Epicor Software, a $350M public company.  At Epicor Mr. McGregor ran two international divisions and personally led numerous multi-million dollar sales campaigns. Under his leadership he successfully groomed both divisions for sale and raised $20M in venture capital from Moore Capital and High Bar Ventures.  Prior to Epicor, he founded, built and sold his own company, Athletic Technologies, Inc., a software company serving the recreation industry.  Earlier, Doug gained extensive R&D experience during his 10 years at Unisys Corporation. Doug earned his BS in Computer Science from the University of Minnesota.

At Granite Equity, we invest human and financial capital from our community of investors, executives, and advisors to advance select companies in our region toward their full potential.