Top 8 Private Equity Firms In Nashville

Nashville, Tennessee, has emerged as a vibrant hub for private equity firms in the United States, attracting both established players and new entrants with its business-friendly environment and robust deal flow. The city’s expanding investment ecosystem is driven by a diverse range of private equity firms, each with its unique focus and investment strategies.

For investors and business leaders looking to navigate this dynamic landscape, understanding the top private equity firms in Nashville is essential. In this article, we will delve into the profiles of the top 8 private equity firms in Nashville, highlighting their areas of focus, notable investments, and the impact they have on the healthcare, manufacturing, and other key sectors. Whether you are an investment professional, an entrepreneur, or simply interested in the private equity space, this guide will provide you with valuable insights into the firms that are shaping the investment landscape in Nashville.

1. LFM Capital

Investment Strategy & Achievements

LFM Capital, founded in 2014 and headquartered in Nashville, Tennessee, is a private equity firm specializing in investing in lower middle market manufacturing and industrial services businesses across the U.S. and Canada. The firm’s investment strategy is deeply rooted in its founders’ backgrounds as operators and engineers, enabling them to bring a unique, hands-on approach to their investments.

At the heart of LFM Capital’s strategy is a commitment to operational excellence and fostering long-term partnerships. The firm focuses on identifying and supporting companies with strong growth potential, leveraging its extensive operational expertise to enhance these businesses. Their approach includes assessing operational risk, implementing modern marketing and sales techniques, optimizing supply chains, and enhancing information systems.

LFM Capital’s achievements are noteworthy. The firm recently closed its fourth fund, LFM Capital Partners IV, with $462 million in aggregate capital commitments, bringing its total assets under management to over $1 billion. This fundraise, coinciding with the firm’s 10th anniversary, was oversubscribed, showcasing the strong trust and support from both existing and new investors.

The firm’s portfolio includes 22 platform investments and 32 add-on investments, demonstrating its active engagement in the manufacturing sector. LFM Capital’s success is further highlighted by its ability to attract investments from charitable endowments, underscoring its commitment to making a positive social impact.

Under the leadership of experienced executives such as Steve Cook, Executive Managing Director, LFM Capital continues to solidify its reputation as a trusted partner for manufacturing companies, driving performance through long-term collaboration and operational excellence.

2. Whistler Capital Partners

Focus Areas and Portfolio Highlights

Whistler Capital Partners, a Nashville-based private equity firm, specializes in growth equity and growth buyouts within the healthcare industry and related tech-enabled services. Founded in 2016, the firm has established a niche by focusing on investments that harness technology and data-driven solutions to fuel innovation and growth in healthcare.

The firm’s primary focus revolves around enhancing healthcare access, quality, experience, and cost efficiency. Whistler Capital Partners achieves this by collaborating with exceptional leadership teams and providing them with strategic resources and capital.

This partnership-driven approach emphasizes deploying or scaling investments in technology-enabled and data-driven opportunities, which are pivotal for modern healthcare services.

Among its portfolio highlights, Whistler Capital Partners has made several notable investments. One standout example is Embold Health, a company that developed an online search platform to help identify medical providers and access clinical guidelines.

The firm’s Series B investment in Embold Health in 2022 underscores its commitment to fostering innovative healthcare solutions.

Whistler Capital Partners’ portfolio reflects a broader strategy of investing in middle-market companies across various healthcare sub-sectors, including health diagnostics, health insurance, and personal health. With over $1 billion in assets under management, the firm plays a significant role in shaping the healthcare landscape through strategic investments and operational support.

Guided by its experienced team, Whistler Capital Partners remains steadfast in building partnerships that drive sustainable development and value creation in the healthcare sector, solidifying its position as a leading private equity firm in Nashville.

3. Arcline Investment Management

Signature Investments & Sector Expertise

Arcline Investment Management, headquartered in Nashville, Tennessee, is a growth-oriented private equity firm with a proven track record of investing in niche, technology-driven businesses. The firm has secured $14 billion in cumulative capital commitments, underscoring its significant presence in the private equity landscape.

Arcline’s investments are distinguished by their focus on high-value industries, including defense, aerospace, industrial technology, life sciences, energy transition, and specialty materials. A notable example is the acquisition of Rotating Machinery Services, Inc. (RMS), a leading provider of aftermarket repair, maintenance, and overhaul services for large, highly engineered turbomachinery.

This acquisition highlights Arcline’s dedication to supporting businesses that are critical to their industries and make a meaningful impact on the world.

The firm’s sector expertise is rooted in a deep understanding of business models and operational intricacies within these high-value sectors. Arcline employs a proactive thematic research approach, combining it with a relentless focus on upside potential and a collaborative, management-first strategy. This methodology allows the firm to identify and unlock the breakout potential of its portfolio companies, driving substantial value creation.

Arcline’s investment in RMS further demonstrates its capability to assist companies with complex engineering and manufacturing operations. By offering strategic resources and operational support, Arcline enables its portfolio companies to overcome industry challenges and seize growth opportunities. This specialized expertise in managing and growing technology-driven businesses positions Arcline as a standout player in the private equity sector.

The firm’s leadership and operational team, including operating partners and principals, are integral to executing its strategy. Their expertise in areas such as supply chain management, finance, and talent development empowers the management teams of Arcline’s portfolio companies to achieve outsized returns.

4. Pharos Capital Group

Healthcare Investing and Community Impact

Pharos Capital Group, a physician-founded private equity firm with offices in Dallas and Nashville, has established itself as a leader in healthcare investing. The firm focuses on areas that improve patient outcomes, increase access to care, and lower healthcare costs. Founded in 1998, Pharos has a long-standing commitment to investing in growing healthcare companies that address critical needs in underserved communities.

One of the key aspects of Pharos Capital Group’s investment strategy is its focus on post-acute care. The firm has built a robust platform through its investment in Charter Health Care Group, which specializes in hospice and home health services. This platform aims to enhance the patient experience and reduce the costs associated with end-of-life and home health care.

By acquiring and integrating high-quality hospice and home health companies, Pharos is driving innovation and efficiency in the post-acute care segment.

Pharos also makes significant investments in other healthcare sub-sectors, including mental health treatment, acute care hospitals, and healthcare staffing. For instance, the firm’s portfolio includes Seaside Healthcare, which operates a network of facilities specializing in mental health treatment services, and IASIS Healthcare, which owns and operates medium-sized acute care hospitals in high-growth markets.

The firm’s community impact is substantial, particularly in rural and urban communities with small and complex populations. Pharos takes a contrarian approach to the traditional healthcare system by prioritizing quality, access, and outcomes over volume. This approach has led to the development of decentralized care models that bring healthcare services closer to the communities that need them most.

For example, Pharos’s pursuit of a Rural Business Investment Company license with the USDA reflects its dedication to expanding healthcare access in rural areas.

Pharos Capital Group’s commitment to community impact is further underscored by its partnerships with organizations like CoBank, which help in identifying and supporting businesses that lower costs and improve healthcare outcomes. The firm’s reputation in the investment space has facilitated these partnerships, enabling it to make a more profound impact on the healthcare landscape.

5. Resolute Capital Partners

Leading in Energy and Technology Investments

Resolute Capital Partners is widely recognized for its investments in healthcare and business services, but the firm also maintains a significant presence in the energy and technology sectors. While their primary focus is on lower middle-market companies, their investment strategy is versatile, spanning a broad range of industries.

In the energy sector, Resolute Capital Partners has shown a strong ability to support companies through various economic cycles. The firm offers structured capital solutions, including subordinated debt and equity, which are customized to meet the unique needs of energy companies. These solutions include funding for growth capital, buyouts, acquisitions, recapitalizations, and refinancing. By providing this financial support, Resolute Capital Partners enables energy companies to navigate market fluctuations and seize growth opportunities.

In the technology space, Resolute Capital Partners has made notable investments, particularly in tech-enabled services. For example, the firm partnered with an independent sponsor to acquire NexusTek, a managed IT services provider catering to small and mid-sized businesses in the Denver area. This investment underscores Resolute’s dedication to supporting technology-driven businesses that deliver critical services to their clients.

The firm’s expertise in evaluating and tailoring solutions for tech companies has been instrumental in fostering growth and innovation within this sector.

Resolute Capital Partners’ collaborative approach and long-term focus are key drivers of their success in both the energy and technology industries. Led by four partners with over 110 years of combined experience, the firm offers a wealth of knowledge and strategic support to its portfolio companies. Their ability to provide flexible capital solutions further establishes them as a valuable partner for companies in these sectors.

The firm’s active deal flow network and commitment to working with private equity and independent sponsors enhance its leadership in these industries. By continually expanding its network and leveraging momentum from previous funds, Resolute Capital Partners continues to make strategic investments that drive growth and value creation.

6. Matthews Real Estate Services

Real Estate Investment Achievements

Matthews Real Estate Investment Services, headquartered in Nashville, Tennessee, has solidified its reputation as a leader in the commercial real estate industry. The firm’s impressive history is marked by significant milestones that highlight its expertise in real estate investment services.

One of Matthews’ most noteworthy achievements is its exceptional transaction volume. Since its inception, the firm has completed an incredible $61.86 billion in sales and 23,622 transactions.

This achievement showcases Matthews’ extensive influence and reach within the commercial real estate market across the United States.

Despite industry challenges, including a downturn in transaction velocity, Matthews has consistently outperformed the market. In Q3 2024, the firm achieved a remarkable 30% year-over-year increase in transactions, contrasting sharply with the industry-wide 15% year-over-year decrease reported by Real Capital Analytics.

Matthews’ success is also driven by its strategic expansion efforts. The firm has opened new offices in several key locations, including New York, Tampa, Jacksonville, Northern New Jersey, Sacramento, Birmingham, Houston, Washington D.C., Columbus, and Louisville. This aggressive expansion has allowed Matthews to enter new markets and attract top talent nationwide.

Another cornerstone of Matthews’ achievements is its commitment to technology. The firm has made substantial investments in its proprietary platform, Matthews Proptech, which is set to launch in early 2025. This cutting-edge technology aims to enhance service lines and provide better support to both agents and clients.

Under the leadership of President David Harrington, Matthews continues to prioritize growth and innovation. The firm’s ability to adapt to changing market conditions and leverage favorable trends has positioned it for sustained success. With over 1,000 agents and employees across 25+ offices, Matthews remains a dominant force in the commercial real estate investment services sector.

7. CapitalSpring

Specialization in the Restaurant Industry

CapitalSpring, a sector-focused private equity and debt investment firm, is renowned for its deep specialization in the restaurant and foodservice industry. With over 18 years of experience and a cumulative investment of $3.7 billion in more than 70 brands across the U.S. and other countries, CapitalSpring has established itself as a trusted and experienced capital partner in this sector.

The firm’s investment strategy focuses on identifying restaurant concepts with strong unit-level economics. CapitalSpring targets brands that achieve store-level margins exceeding 15% and returns on investment of over 20%.

This rigorous selection process ensures investments in businesses with robust growth potential and solid financial foundations. For example, their recent investment in Bushfire Kitchen, a fast-casual concept in California, highlights their focus on emerging brands with exceptional food quality and multi-market expansion potential.

CapitalSpring’s flexibility in investment structures is another key aspect of its approach. Unlike traditional private equity firms, CapitalSpring offers a range of investment options, including control private equity, mezzanine capital, and senior lending.

This flexibility allows the firm to provide custom investment solutions tailored to the specific capital needs and strategic plans of the companies they partner with. For instance, their one-stop financing solution enabled an operator to fully separate from an existing partner and then quickly double the size of their business.

The firm’s valuation approach is also noteworthy. In today’s moderate market, CapitalSpring evaluates valuations ranging from 5-6x EBITDA for average performers to multiples in the teens for exceptional brands with proven multi-state scalability. For brands aiming to become industry leaders, a 10x EBITDA valuation is considered favorable, although macroeconomic factors can introduce uncertainty into these valuations.

Under the guidance of experienced leaders like Jim Balis, Partner and Head of Strategic Operations, CapitalSpring continues to navigate the evolving landscape of restaurant investments with a keen eye for opportunity and a deep understanding of industry dynamics. This expertise has enabled the firm to invest in over 3,000 restaurants, making it a significant player in the restaurant and foodservice sector.

8. Rubicon Founders

Innovative Approaches to Healthcare Investments

Rubicon Founders, an entrepreneurial healthcare investment firm based in Nashville, Tennessee, stands out for its innovative and transformative approach to healthcare investments. The firm is dedicated to building and growing companies that redefine the way people receive healthcare, with a focus on creating lasting value through meaningful businesses.

Rubicon Founders utilizes a unique “Ground Up” strategy, applying a proven analytic process to identify and create companies with a competitive edge, referred to as “Value Edge.” This approach involves designing transformational companies from the ground up to establish a solid foundation for industry leadership. Complementing this strategy is their “Platform and Special Opportunities” initiative, where they collaborate with exceptional teams to transform lives and generate value.

The firm’s investment portfolio showcases its commitment to innovation and patient-centered care. A notable example is Rubicon Founders’ majority investment in Horizon Infusions, Ohio’s largest network of ambulatory infusion centers.

Horizon Infusions operates 21 centers across the state, delivering critical infusion therapies to patients with chronic conditions in a convenient outpatient setting. This investment aligns with Rubicon’s mission to enhance access to high-quality, low-cost, patient-focused care in optimal ambulatory care environments.

Rubicon Founders further diversifies its investments across other innovative healthcare sectors, such as value-based nephrology, primary care physician enablement, virtual-first value-based care pediatrics, and AI-powered professional liability underwriting. Their portfolio includes companies like Profound, which empowers community physicians to offer clinical research as a therapeutic option to their patients, as well as platforms for ambulatory infusion services—highlighting their forward-thinking investment strategy.

The firm’s leadership team, including partners like Matt Kim, plays a pivotal role in driving these groundbreaking approaches. Their entrepreneurial spirit and dedication to patient-centered care are vital in accelerating the growth of portfolio companies.

By partnering with talented leadership teams and providing strategic vision, Rubicon Founders continues to make a significant impact on the healthcare industry.

Conclusion

In conclusion, Nashville’s private equity landscape is vibrant and diverse, with firms like LFM Capital, Whistler Capital Partners, Arcline Investment Management, Pharos Capital Group, Resolute Capital Partners, Matthews Real Estate Services, CapitalSpring, and Rubicon Founders leading the way. Each firm brings unique strengths, whether in manufacturing, healthcare, energy, technology, or real estate.

These firms not only drive growth and innovation but also contribute significantly to their respective industries and local communities. For investors, entrepreneurs, and industry professionals, understanding these top private equity firms in Nashville can provide valuable insights and opportunities for collaboration and growth. As the city continues to evolve as a hub for private equity, it is essential to stay informed and engaged with these industry leaders to capitalize on the emerging opportunities and trends.