Dallas-based industrial-focused private equity firm Sole Source Capital LLC today announced its portfolio company I.D. Images more than doubled in size and tapped into new North American markets through three major acquisitions over the last five months.
The company’s rapid expansion happened after Ohio-based I.D. Images, which provides product identification solutions for multiple markets, became a Sole Source Capital portfolio company in August 2021.
I.D. Images acquisitions of Digital Printing Concepts, Multi-Action Communications, and Valley Forge Tape & Label Company extend the company’s reach to new markets across the U.S. and Canada. Terms of the transactions were not disclosed.
Sole Source Capital raised $555M in October
The announcement continues a strong run for Sole Source Capital highlighted by the October closing of its second fund with total commitments of $555 million. At the time, the firm said Fund II was “significantly oversubscribed” after an initial target of $400 million. The closing of Fund II provided Sole Source Capital with over $1 billion in managed funds only three years after the launch of its Fund I.
Sole Source Capital is focused on quickly driving value in lower middle-market industrial companies, particularly in warehouse automation, barcoding, and food distribution. It’s often the first institutional capital partner for its portfolio companies and seeks to drive significant operational transformations, the company said.
About closing Fund II, David Fredston, Sole Source Capital founder and CEO, said in a statement, “We believe Sole Source Capital’s investment process and commitment to human capital and data analytics can deliver great results, and we are humbled to have our limited partners investing alongside us.”
Inc. 2021 ‘Founder-Friendly’ investor
Also in October 2021, Dallas Innovates reported Sole Source Capital was named one of Inc.’s 2021 “founder-friendly” investment firms. The Inc. list is open to both private equity and venture capital firms and recognizes startup investment partners that “entrepreneurs can trust and collaborate with while receiving the financial support they need to help accelerate growth,” Inc. said in a news release.
Fredston founded Sole Source Capital in 2016 with a team of experienced private equity professionals. The first fund launched in 2018. Within its industrial-focused investment target, Sole Source is noted for quickly executing deals and prioritizing rapid transformation.
The news about portfolio company I.D. Images’ rapid growth through three acquisitions fits into Sole Source’s approach of finding businesses that will benefit from its operating and M&A capabilities.
Quincy Preston contributed to this report.
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