In October, ACG National Capital will be celebrating 25 years of middle market growth at the 25th Anniversary Celebration and Networking Event. Corporate Growth, Capital Style will be posting insightful interviews with past ACG presidents leading up to the big event.
In our last post, we continued the series with a discussion with former president Greg Van Beuren. Our next conversation was with former chapter president Braun Jones, who served from 2009 until 2010.
Mr. Jones is currently a Managing Director at Outcome Capital, where he provides advisory services for mergers, acquisitions, and debt and equity private placements. Prior to joining Outcome Capital, Mr. Jones founded Integrated Management Strategies (IMS), a corporate finance advisory firm. After IMS was acquired in 1994, Mr. Jones co-founded University Online Inc., which was later renamed VCampus. In 1998, he successfully exited VCampus to co-found a DC-based, middle-market investment bank. He sold the firm in 2005, and has been with Outcome Capital ever since.
Here is what Mr. Jones had to say about his time with the ACG, as well as how corporate growth activity and the business market has changed in the National Capital region since he was president:
CGCS: Can you describe a significant occurrence that happened in the deal community during your tenure as ACG National Capital president.
Mr. Jones: Given the major financial crisis that began in 2008, and the long-term recession that followed, transaction activity was down significantly when I took office as President in mid-2009. By the end of 2009, I remember M&A activity being off by about 50% overall and about 30% for the government contracting community – an important contributor to the economic health of the National Capital Region.
As usual, the Washington region fared better than the rest of the country; however, I remember a significant pullback owing not only to real economic factors, but also a negative psyche pervasive in the market that was hard for dealmakers to overcome.
Having said this, some deals were still getting completed such as the notable $1.65 billion acquisition of TASC by General Atlantic and KKR. This transaction was significant given it was the first acquisition of a government contracting company by these two private equity titans and also the first deal driven by organizational conflicts of interest – the beginning of a trend still underway today.
CGCS: Can you describe something significant that happened during your time as chapter president.
Mr. Jones: The most significant honor during my term as President was National Capital Chapter winning the “ACG Chapter of the Year” which, to my knowledge, we had never done before or since. This was not a single-year achievement, but rather the recognition and culmination of many years of high quality work and contributions of the staff, members, and board leadership of the highly successful ACG National Capital Chapter.
During my term, the board and executive committees also started the ACG National Capital Blog, “Corporate Growth, Capital Style,” and the M&A Roundtable which is now being adopted by ACG globally.
CGCS: What changes have you seen in the DC business community in the last 25 years? How has the business climate changed? Any new industries to take note of?
Mr. Jones: I was just getting out of business school 25 years ago and at that time, I remember the region’s business publications, such as Regardi’s and the Washington Business Journal, were very focused on commercial real estate. Washington’s commercial real estate industry collapsed around 1990, and with the onset of The Gulf War that same year, government contracting emerged as a growth industry once again.
However, the government was not the only game in town. During the ‘90s, among others, AOL and WorldCom were major factors establishing the National Capital Region as a technology, Internet, and telecommunications center.
When the dot-com and telecom boom cratered in 2000, Wall Street was searching for safety and stability. This factor, coupled with 9/11 and the resulting boom in government defense and homeland security spending placed the government contracting industry front and center for years to come.
The great recession and government budget pullbacks have added a great deal of uncertainty in recent years, but all of these events have reshaped Washington significantly.
CGCS: Can you describe some of the major trends shaping and influencing the business environment in DC today. How has that shaped corporate growth activity?
Mr. Jones: Referring to my previous answer, I believe the Washington region has established itself as a diversified economic center not reliant on any single industry.
Relatively speaking, the government services industry dominated the business landscape much more 25 years ago than it does today. Washington has a very strong, diverse business services base that is bolstered by the technology, life sciences, healthcare, and telecommunications sectors.
From an economic perspective, I believe the National Capital Region will continue to perform better than most other geographies, in good times and bad, owing to its eclectic mix of growth industries and well-established entrepreneurial activity.
To hear more from Braun Jones and the rest of the ACG National Capital past presidents, register for the 25th Anniversary Celebration and Networking Event on Wednesday, October 9, 2013 at the Waterview Center in Arlington, VA. Additional details and event registration are available HERE.