Directorbank Adds Private Equity Investment To Its Board Recruitment

Directorbank, the board recruitment company, is to take a stake in growth companies in lieu of part of its search fee. It has already signed up to work alongside two private equity houses who will pay Directorbank 50% of any

By None

Directorbank, the board recruitment company, is to take a stake in growth companies in lieu of part of its search fee.

It has already signed up to work alongside two private equity houses who will pay Directorbank 50% of any appointment fee, with the remainder becoming a stake in the company that the private equity house is investing in. Directorbank will receive the same terms as other investors.

“We are backing our belief in the quality of our directors,” says Elizabeth Jackson, CEO of Directorbank. “We only place directors who can demonstrate a track record of achieving significant shareholder growth and we know our directors are among the most outstanding in the industry.”

This new product is designed for venture capital houses and managed investment funds, rather than for private individuals, and will be available only to companies requiring investment up to 2 million.

“We are relying on the quality of due diligence carried out by the investors,” adds Jackson. “By the nature of this market, some of our investments will not perform well but we expect one or two gems and the overall portfolio to beat the FTSE index several times over.”

Richard Bamford, executive chairman of Enterprise Ventures, which has signed up to offer this product, says, “As a venture capital firm, we put a lot of investment into high growth businesses, which benefit greatly from having high quality, skilled directors to mentor them. Directorbank does extremely well at finding these high calibre people.”

“But these businesses are typically young and growing and not able to afford upfront costs. Directorbank’s enlightened initiative to commute a significant part of their fees is very innovative and will enable growth companies to afford the best talent.”

This move will build the value of Directorbank’s own balance sheet, which completed a management buy-out last year backed by Nova Capital Management and Yorkshire Bank.

Marion Bernard, chief executive of NorthStar Equity Investors, says, “We remain hugely impressed by the quality of candidates Directorbank are able to source for high growth venture backed technology companies in the North East of England, and we look forward to working with them more closely going forward. Their innovative charging model will help allow many more start up and early stage businesses to benefit from the high quality offering from Directorbank.”

Directorbank has signed up 2,500 very senior directors who are looking for opportunities in private equity backed businesses. It is retained by 72 private equity houses who access these directors when putting deals together and often go on to appoint them as chairmen, non-executive directors, chief executives and finance directors in deals such as management buy-outs and buy-ins. Directorbank also has an executive search arm.

Recent Directorbank appointments include: Bill Shannon as chairman of The Grill Group (Octopus Private Equity), Roger Parry as executive chairman Media Square Plc, John Duffy as non-executive director of Denby Potteries; Matthew Streets as chief financial officer at Foster + Partners; Rob Parker as group finance director at Topps Tiles Plc; Dr Raj Rajagopal was appointed non-executive director of Dyson Group Plc and David Mills a non-executive chairman of My Home Move Ltd. Roger Matthews was appointed chairman of LSL Property Services Plc.

«