Teamsport
Profile of the company
TeamSport is Europe’s largest operator of go kart tracks. From the £7.8m management buyout of February 2013 until the exit in October 2017, the business consistently performed in line with management’s business plan, successfully growing from 9 to 23 tracks and quadrupling in profitability. TeamSport established a sustainably differentiated business model, and professional brand, in a fragmented ‘hobbyist’ UK market with individual new tracks delivering 35% return on capital employed.
Investment Summary
From leading the initial investment and throughout his involvement on the board, Julian Carr supported TeamSport’s growth through:
- Encouraging CEO Dominic Gaynor to develop an accelerated roll-out strategy
- Introducing an experienced Non-Executive Chairman, Peter Roberts, the founder of PureGym
- Supporting expansion of the senior management team with the appointment of an Operations Director with extensive multi-site leisure experience
- De-risking the business and the reliance on one particular track with a number of targeted, strategic acquisitions
- Delivering the additional financing to support the accelerated track roll-out
- A strategy of re-negotiating lease terms to improve the weighted average lease length from 6 years in 2013 to over 12 years at exit
- Encouragement of the development of the online marketing proposition with the introduction of specialist e-commerce consultants
Exit
Having successfully grown track numbers from 9 to 23 and quadrupling profitability, the management team, led by CEO Dominic Gaynor, completed a secondary buyout delivering 4.1x returns to investors in the original 2013 MBO. Julian engineered the funding of the secondary MBO in October 2017 by Duke Street and investors of Ethos Partners and Bestport.
| Sector | Leisure |
|---|---|
| Location | Farnham |
| Investment type | Management Buyout* |
| Investment size | £8m |
| Date of transaction | February 2013 * |
| Status | Exited – 4.1x |
| Website address | www.team-sport.co.uk |
Dominic Gaynor, CEO says:
“Julian understood our business model from the outset and has encouraged us to lift our horizons which has seen us substantially surpass our original goal of growing to 16 tracks over 5 years. As with any smaller company, we have had to jump a number of hurdles and Julian has been incredibly supportive throughout with advice and guidance in growing the business and in developing the management team and the strategy”
Julian Carr, Ethos Partners Principal says:
“The TeamSport investment relationship has been a great partnership. The initial focus was to work with management to derisk the business with a number of strategic acquisitions ahead of the new build roll out and to negotiate significantly increased bank funding support. Thereafter whilst outwardly an exciting business, it actually felt like a steady ride from an investor perspective, which is the greatest of compliments to management for their consistency of delivery. I have thoroughly enjoyed working with Dom and the team and share their pride in what they have achieved in the business which is reflected in the valuation placed upon the business in October 2017. I feel privileged to have backed management originally and to have been able to back them again alongside Duke Street in the secondary management buyout and to rejoin the Board to take the business to the next stage.”
* Julian Carr led this transaction prior to joining Ethos Partners