- CCMP Growth Advisors raised over $500 million for its first independent buyout fund, CCMP Capital Investors IV, closing in July 2024 above target.
- Founded in 2022 by ex-CCMP Capital partners Joe Scharfenberger and Mark McFadden, the firm targets North American consumer and industrial lower-middle-market, often family- or founder-owned businesses.
- It pursues mainly control investments of $50–$200 million in companies with ~$15–$75 million of EBITDA and 10%+ organic growth, with M&A used to scale.
- Four early platforms (Mammoth, Omnia, Decks & Docks, Innovative Refrigeration) posted about 16% revenue growth and 21% EBITDA growth in 2023, supporting the strategy despite typical sector and fundraising risks.
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CCMP Growth’s successful fundraise—exceeding its $500 million goal while being its debut independent fund—signals strong investor confidence despite challenging conditions in private-equity fundraising. Existing relationships from CCMP Capital’s legacy funds, early deal flow execution, and a strategy aligned with resilient sectors appear to have helped it stand out.
The firm’s strategic positioning is sharply differentiated in three dimensions: size, ownership/control preferences, and growth profile. Targeting companies with EBIDTA of $15–$75 million and deal sizes between $50–$200 million (including co-investments) situates it well in the lower middle market. Control investments—rather than growth equity minority stakes—indicate a more hands-on approach and higher risk/reward trade-offs. Requirements of ~10% organic growth plus accretive M&A overlay prioritize durable operational ramp-up and scalability.
The early portfolio provides strong proof points. Mammoth’s rapid expansion in car washes, Omnia’s partner model in roofing, Decks & Docks’ growth via both organic and add-on strategy in specialty distribution, and Innovative Refrigeration’s vertical integration and software capabilities each reflect CCMP Growth’s thematic preferences toward underpenetrated industrial/consumer niches, durable free cash flows, and digital or value-added technology. Collectively, these yield ~16% revenue growth and 21% EBITDA growth across four companies in 2023, suggesting the strategy can deliver.
However, several strategic risks and open questions emerge: Fund size vs. deployment pacing, competition for control deals in the same market, potential cyclicality in consumer/industrial sectors, and exit timing/liquidity constraints. Sub-sectors like roofing or refrigeration can face supply-chain, labor, and regulatory pressures. Also, with over 10% of commitments coming from firm insiders and retired legacy partners, alignment is strong—but concentration risk and raising future funds under the CCMP Growth brand may depend heavily on performance benchmarking against CCMP Capital’s historic track record.
Supporting Notes
- Final close of CCMP Capital Investors IV in July 2024 raised in excess of $500 million, surpassing its target.
- CCMP Growth was formed in 2022 by Joe Scharfenberger and Mark McFadden after serving in CCMP Capital; leadership and team remain largely the same.
- Focus sectors: North American consumer and industrial middle-market companies, often family- or founder-owned.
- Investment size and structure: Equity investments typically $50–$200 million including co-invest, mainly control buyouts but some selective growth equity.
- Targets: organic revenue growth of ~10%+, EBITDA between $15 million and $75 million.
- Four early portfolio platforms: Mammoth Holdings (car wash operator); Omnia Exterior Solutions (roofing/exterior remodeling); Decks & Docks (marine and outdoor living distribution); Innovative Refrigeration (industrial refrigeration design‐build and aftermarket services).
- Performance: across those four companies, ~16% average revenue growth and ~21% average EBITDA growth in 2023.
- Fund investor base includes pension funds, insurance companies, financial institutions, family offices, and more than 25 C-suite or board members from legacy CCMP Capital’s portfolio companies. Internal alignment: >10% of fund committed from firm employees, executive advisors, and former partners.