Shaky markets still hold plenty of opportunity
Dave Gray, ’93 management, has built his career in the software business, serving as CEO of three companies, two of which he started. The newest is only a few months old.
Stoneybrook Ventures, headquartered in Birmingham, last June partnered with Pamlico Capital of Charlotte, North Carolina, to form a search company that will acquire one or more software-as-a-service (SaaS), B2B, mission-critical businesses. He said he is looking for businesses that need a CEO transition because they have grown too big for the founder to manage or because the founder wants to start another business or maybe just retire and go to the beach. Gray will take a majority share, serve as CEO, and grow the company over time. He said he’ll likely buy more than one company but keep them under the same umbrella to consolidate management.
Gray already had a relationship with Pamlico Capital through Daxco, a Birmingham company where he was CEO for 15 years and served on the board for three more. During that time Daxco bought eight other companies using a similar method: They made one initial acquisition and then looked for others that fit well. Daxco was and is a business-to-business SaaS company that provides software and services to health-and-wellness, member-driven organizations like the YMCA, large fitness companies like Crossfit, recreation centers, hotels and others. As CEO, he grew the company from a startup to a global enterprise with 10,000 customers producing double-digit revenue growth for 15 years.
He said the current uncertain economy doesn’t concern him. While it gives some people pause, others look to find a good opportunity, and long-term investors are bullish on the software space in the market. There’s a lot of private equity out there, he said, and he’s focusing on that. Most people he deals with view the current economic situation as temporary, and a wobbly stock market doesn’t scare them off.
While he was building Daxco, he recruited many AU alums. He and his wife decided to move back to Alabama from Chicago because she was pregnant with twins, their first children, and they wanted to be closer to home.
“When we got to Birmingham in 2003, I reconnected with Auburn,” he said. “I went to campus to speak to classes. A lot of members of our team were Auburn graduates,” he said.
He was a founding member of the school’s Management and Information Systems Advisory Board and a member of the Harbert College of Business Advisory Council for several years.
