Stone Arch Capital

What Stone Arch Capital does

Stone Arch Capital is a Minneapolis-based private equity firm founded in 2003 by Charles B. Lannin and F. Clayton Miller that historically made control equity investments in leading private businesses primarily in the Midwestern United States. The firm has raised three Stone Arch funds and operates with a small team, sourcing deals through a relationship-driven network of advisors, investment bankers, attorneys, and accountants. The firm is no longer making new platform investments and is currently focused on growing and exiting its remaining portfolio companies while evaluating add-on acquisitions for existing holdings.

The firm's portfolio spans diverse industries including electrical contracting (ICS Holding, with more than 1,000 employees across 15 offices in 7 states), LED architectural lighting (Lambent Holdings - Delray Lighting and LF Illumination, exited May 2022), exotic automobile sales (Marshall Goldman Motor Sales), traffic control services (Helix Traffic Solutions, exited August 2021), fertilizer storage construction (Stueve Holdings), flexible packaging manufacturing (Bulk Lift International, exited November 2022), toy distribution (Toysmith), metal component manufacturing (East Iowa Machine Company, exited October 2023), pavement preservation contracting (Mid-State Restoration, exited August 2021), and collectible coin direct marketing (AMS Holding). The leadership team and Advisory Council together bring over 100 years of collective private equity experience and involvement in the purchase and sale of more than 150 companies.

The firm generates revenue through management fees charged on committed capital across its investment partnerships and carried interest (performance fees) from successful exits of portfolio companies. There is no proprietary technology, software product, or technology-enabled platform; the underlying capability is deal judgment, operational value creation through add-on acquisitions, and relationship-driven sourcing. Notable recent exits across 2021-2023 indicate an active harvest phase of the fund lifecycle, consistent with the firm's stated shift away from new platform investing.

Name

Stone Arch Capital

Legal name

Stone Arch Capital, Inc.

Website

https://stonearchcapital.com

Company type

Private

Founded year

2003

Operating status

Operating

Headcount range

11–50 employees

Short description

Minneapolis-based private equity firm founded in 2003 that historically made control equity investments in Midwestern US private businesses and is now focused on growing and exiting its remaining portfolio across electrical contracting, LED lighting, exotic automobiles, and other industries.

Ownership category

akta.pro rank

Product category

Private Equity Investment Management

NAICS

Portfolio Management and Investment Advice (52394), Other Financial Investment Activities (5239)

SIC

Investment Advice (6282)

akta.pro primary industry

Small-Cap / Micro-Buyout (FSANABAD)

Keywords

• Private equity investments
• Middle-market buyouts
• Control equity investing
• Portfolio company management
• Add-on acquisitions

Headquarters

HQ city

Minneapolis

HQ country

United States

HQ region

North America

Offices1 record

Markets served

GTM type

B2B

Offering type

Services

Cost components

Personnel, Operations, Marketing or Sales, Others

Revenue model

1. Fund Management and Carried Interest: As a private equity firm, Stone Arch Capital generates revenue through management fees charged on committed capital and carried interest (performance fees) from successful exits of portfolio companies. The firm manages investment partnerships and the firm's model focuses on creating value through operational improvements, add-on acquisitions, and strategic growth initiatives before exiting investments.

Go-to-market motion1 record

Distribution channels1 record

Marketing channels1 record

Core offering

Stone Arch Capital manages private equity buyout funds that make control equity investments in leading private businesses across a wide range of industries, primarily in the Midwestern United States. The firm invests via its investment partnerships and provides portfolio companies with growth capital, strategic planning support, add-on acquisition execution, and operational improvements, ultimately exiting investments to strategic buyers, financial sponsors, or public markets. The firm is no longer making new platform investments and is currently focused on growing and exiting its existing portfolio companies while evaluating add-on acquisitions for those holdings.

Product overview

Stone Arch Capital is a Minneapolis-based private equity firm that made control equity investments in leading private businesses across a wide range of industries, primarily in the Midwestern United States. The firm is no longer making new platform investments but is focused on growing and exiting their current portfolio companies, with continued evaluation of add-on acquisitions for existing portfolio companies. Their portfolio includes investments across diverse sectors including lighting/LED manufacturing (Lambent Holdings), electrical contracting services (ICS Holding), exotic automobile sales (Marshall Goldman), traffic control services (Helix Traffic Solutions), fertilizer storage construction (Stueve Holdings), flexible packaging manufacturing (Bulk Lift International), toy/gift products distribution (Toysmith), metal component manufacturing (EIMCo), pavement preservation contracting (Mid-State Restoration), collectible coin marketing (AMS Holding), and others.

Differentiator

Problem solved

Functional benefit

Brands

• Lambent Holdings: Holding company created to own and operate premier lighting companies within the LED lighting space
• ICS Holding
• Marshall Goldman
• Helix Traffic Solutions
• Toysmith
• AMS Holding
• Stueve Holdings
• Bulk Lift International
• Mid-State Restoration
• EIMCo (East Iowa Machine Company)
• GL 360
• Norwesco
• Mail Communications Group
• Natural Resource Group

Products and services

• Control Equity Investment Funds Private equity funds that acquire controlling equity stakes in leading private businesses, primarily in the Midwestern United States. Investors commit capital to the fund, and the firm deploys that capital to acquire and support portfolio companies through operational improvements, strategic initiatives, and add-on acquisitions, exiting investments via sale to strategic buyers, financial sponsors, or public markets.
• Portfolio Company Operational Support Ongoing post-investment support to portfolio companies delivered by Stone Arch Capital's partners and augmented by an Advisory Council. Services include financial analysis and modeling, strategic planning, identification and execution of add-on acquisitions, product line and service expansions, personnel additions, geographic and facility expansion, IT enhancement, process optimization, and succession planning.
• Add-On Acquisition Program Program of acquiring smaller companies to add to existing portfolio platforms to accelerate growth, geographic reach, and product line breadth. Stone Arch continues to evaluate add-on acquisitions for current portfolio companies even though it is no longer making new platform investments.

Quantifiable outcome

• Over 150 companies bought and sold
• +2 more outcomes

Named customers10 records

Segments3 records

Ideal customer profiles3 records

Technology focussed No

API detail

Has API

No

API docs

API detail

Core technology

AI maturity

App detail

Scale indicators4 records

Recent moves6 records

Expansion highlights3 records

Direct peers

• Shore Capital Partners: Chicago-based private equity firm focused on control investments in lower-middle-market healthcare and industrial services businesses. Comparable lower-mid-market fund size and partner-led operating model.
• Grey Mountain Partners: Lower-middle-market private equity firm focused on control investments in industrial, business services, and consumer companies. Comparable fund size and operating-partner-driven value creation model.
• Huron Capital Partners: Detroit-based private equity firm focused on lower-middle-market control investments, often partnering with founder/family-owned businesses. Comparable Midwestern focus and lower-mid-market buyout approach.
• Lariat Partners: Lower-middle-market private equity firm making control investments in family/founder-owned businesses across the Mountain West and Midwest. Similar transaction profile and operating partner structure.
• Tonka Bay Equity Partners: Minnetonka, MN-based private equity firm focused on control investments in lower middle-market companies, often family/founder-owned. Same Minneapolis-area geography and lower-middle-market buyout thesis.
• Ancor Capital Partners: Minneapolis-based lower-middle-market private equity firm making control investments in profitable companies, frequently with founder/family sellers. Directly comparable in geography, fund size, and operating partner model.
• Spell Capital Partners: Minneapolis-based private equity firm that invests in manufacturing, distribution, and service businesses, primarily in the upper Midwest. Comparable in regional focus, transaction size, and industrial orientation.
• Norwest Equity Partners: Minneapolis-based private equity firm focused on control investments in middle-market companies, often in the Midwest. Highly comparable given shared geography, similar lower-middle-market strategy, and the fact that Stone Arch co-founder Charles Lannin was previously a GP there.
• Bregal Sagemount: Mid-market private equity firm making control investments across North America with sector breadth including industrial, business services, and consumer. Comparable fund size and diversified lower-mid-market buyout approach.

Broad incumbents

• GTCR: Chicago-based private equity firm with a much broader strategy and larger fund size, but similar Midwest roots and a long history of partnering with management teams in diversified industries. A larger incumbent with overlapping lower-mid-market activity.

Market position

Strengths5 records

Weaknesses5 records

Competitive moat4 records

Key risks7 records

Key highlights7 records

Customer concentration

Revenue estimate

Valuation estimate

Number of profiles

Profiles8 records

Subsidiaries10 records

Funding overview

Funding rounds

Investors

Funding detail is available on the Subscription and Enterprise plan.Contact sales →

M&A

Investments

M&A and investment is available on the Subscription and Enterprise plan.Contact sales →

Frequently asked questions about Stone Arch Capital