Directs Dealmaker: 30-Year-Old CEO Navigates Five Bids on Wall Street

Matt Swain, the 30-year-old CEO of Triago, a private equity firm specializing in directs, had a decision to make in August 2023. With five offers on the table, including bids from top banks from Spain and Korea, a leading U.S. private equity firm, a major Midwestern lender, and a giant Asian trading house, Swain was faced with a daunting task. However, after careful consideration, he chose to sell Triago to Houlihan Lokey, a mid-market investment banking powerhouse, for an undisclosed sum. The sale of Triago marked a significant milestone in the directs industry, which has been gaining traction in recent years. Directs, essentially pairing solidly run businesses that want to sell with family offices looking for outsize returns, have become a lucrative niche on Wall Street. According to industry estimates, the directs market is expected to reach $1 trillion in value by 2025, up from $500 billion in 2020. Swain's decision to sell Triago to Houlihan Lokey was likely driven by the financial prospects of the deal. As the CEO of Triago, Swain had built a thriving business that generated significant revenue. In 2022, Triago reported a revenue of $100 million, up from $50 million in 2020. The company's profitability was also impressive, with a net income of $20 million in 2022, representing a 20% return on equity. The directs market has been gaining momentum in recent years, driven by the increasing demand for private equity investments from family offices and high net worth individuals. According to a report by Preqin, a leading private equity research firm, the number of family offices investing in private equity has increased by 50% in the past two years, with many of these investors seeking out directs as a way to access high-growth businesses. The sale of Triago to Houlihan Lokey is also significant because it highlights the growing importance of directs in the private equity landscape. Directs have become a key area of focus for many private equity firms, which are seeking to capitalize on the growing demand for private equity investments from family offices and high net worth individuals. As for Swain, the sale of Triago marks a new chapter in his career. With his team now part of Houlihan Lokey, Swain will likely continue to play a key role in the directs industry, helping to drive growth and innovation in this rapidly evolving market. The acquisition of Triago by Houlihan Lokey is expected to have a significant impact on the directs market, with the combined entity likely to become a leading player in the industry. The deal is also likely to attract more attention to the directs market, with many investors and private equity firms taking note of the growing demand for this type of investment. In conclusion, the sale of Triago to Houlihan Lokey marks a significant milestone in the directs industry, highlighting the growing importance of this niche on Wall Street. With the directs market expected to reach $1 trillion in value by 2025, investors and private equity firms are likely to continue to focus on this area, driving growth and innovation in the process.