Crains New York - August 13, 2012 - (Page 13)

REPORT SMALL BUSINESS INSIDE The NY area’s largest benefits consulting firms PAGE 15 Spotlight Health benefits business is booming for consulting firms as their clients prepare for the Affordable Care Act PAGE 15 Private equity: growth catalyst New York is the national epicenter of dealmaking BY EILENE ZIMMERMAN When Steve Ehrlich, chief executive of Manhattan-based Lightspeed—a provider of real-time trading technology to professional traders—needed money to acquire other broker-dealers and expand his company’s marketing efforts, he took a $30 million investment from private-equity firm LLR Partners in Philadelphia. Mr. Ehrlich said he and his co-founders at Lightspeed, which has revenues above $45 million and 91 employees, chose LLR for the deal in 2010 because the firm shared Lightspeed’s strategy of expansion through marketing and acquisitions. “Teaming with LLR was the catalyst we needed,” said Mr. Ehrlich. VALUE of privateThe firm equity deals provided in New York more than state in 2011 just capital. “They have quickly become a strategic partner that shares our vision for the future,” he added. Debate about Republican presidential contender Mitt Romney’s past career at Bain Capital has put the privateequity firm and others like it in the spotlight. Critics of the industry have told stories about companies backed by private equity being crushed by debt, chopped up or stripped down. However, leaders of small and midsize companies such as Mr. Ehrlich describe a different reality, where private-equity investors can be a useful source of financing for well-established small businesses with revenue and a solid track record. Some ailing companies also turn to private-equity firms to bring in the management expertise and money needed for a turnaround. The firms also can be buyers in a market where it’s otherwise hard to sell a business for an attractive price. RISK TAKER: Steven Asherman—the 62-year-old kid in the middle of this picture—embracing entrepreneurship at an age when many think about retiring. buck ennis $18.6B Move over, millennials UNRETIRED The share of new entrepreneurs ages 55-64 20.9% They may not wear hoodies or pull all-nighters, but these later-in-life entrepreneurs haven’t ruled out creating the next Facebook BY ANNE FIELD In many ways, Steven Asherman is not particularly different from the other technology-startup founders working at the NYU-Poly Varick Street incubator in downtown Manhattan. Like his colleagues, Mr. Asherman spends his days focused on launching a Web 2.0 company, in his case Content Galaxy, which aims to create online channels for publishing videos and print material. But there’s one notable difference between Mr. Asherman and the rest of the pack. At 62, he’s a good 30 to 35 years older than most of his comrades. Starting an Internet company amid a sea of twentysomethings hasn’t put a crimp in Mr. Asherman’s style. On the whole, working with younger people has been more of a boon than a problem. He garnered invaluable information about such areas as social media and streaming video, for example, while offering his insights to younger colleagues gained from his years heading another company, Base One International, a software-as-aservice consulting firm he founded in 1993 and still runs. Base One International has “$1 million to $3 million” in revenue and seven employees who also work for Content Galaxy. “There’s a give-and-take,” said Mr. Asherman, whose 4-year-old company is still “pre-revenue. … I’ve learned about things I knew nothing about before.” When many people envision digital startups, they think of young, would-be Mark Zuckerbergs in hoodies and T-shirts spending late nights coding at a company with a name that’s missing a vowel. But See MIDLIFE STARTUPS on Page 14 14.3% 1996 2011 Source: Ewing Marion Kauffman Foundation See PRIVATE EQUITY on Page 16 August 13, 2012 | Crain’s New York Business | 13

Table of Contents for the Digital Edition of Crains New York - August 13, 2012

Crains New York - August 13, 2012
Table of Contents
IN THE BOROUGHS
IN THE MARKETS
THE INSIDER
BUSINESS PEOPLE
CORPORATE LADDER
OPINION
GREG DAVID
REAL ESTATE DEALS
FROM AROUND THE CITY
REPORT: SMALL BUSINESS
THE LIST
CLASSIFIEDS
NEW YORK, NEW YORK
SOURCE LUNCH
OUT AND ABOUT
SNAPS

Crains New York - August 13, 2012