AIC and Punchbowl News Host Event with Gov. Brian Kemp (R-GA) and Zaxby’s CEO Examining How Private Equity is Strengthening Georgia Small Businesses

Governor Kemp on why private equity is choosing to invest in Georgia: “When people are deploying capital here, they know they’re going to have a stable environment”

Atlanta, GA – Yesterday, the American Investment Council sponsored an event hosted by Punchbowl News examining how private equity is investing in and providing critical capital and expertise for small businesses based in Georgia. Punchbowl News Founder Anna Palmer interviewed Governor Brian Kemp (R-GA) one-on-one. Afterward, Anna sat down with Drew Maloney, President & CEO of AIC, and Bernard Acoca, CEO of Zaxby’s, a beloved Georgia-founded and private equity-backed fast-casual chicken restaurant chain. In 2022 alone, private equity invested more than $19.2 billion in Georgia-based businesses. These private equity investments support more than 377,000 jobs at more than 400 Georgia-based businesses that pay more than $30 billion in wages and benefits.

Private Equity’s Role in Growing Georgia’s Small Businesses

In 2023, Georgia was named the No. 1 state for business for the 10th consecutive year – and private equity has played an essential role in spurring economic growth and supporting small businesses across the state. As a small business owner, Governor Kemp highlighted the vital role private equity investments play in supporting small businesses in his state, saying, “Private equity has been a big part of that just because we have great home-grown companies and family businesses in our state. And when people are deploying capital here, they know they’re going to have a stable environment.”

Private Equity Investments Support Nearly 400,000 Georgia-based Jobs

When asked what he thinks drives private equity to invest in Georgia, Governor Kempnoted, “Well, I mean, it’s really part of the whole ecosystem we have here. I think that is what’s driving private equity to look at Georgia-based companies or look at moving corporate headquarters here … such a big plus for us when you look at the jobs front is the talent that we have here. So, for these companies that are buying businesses and growing their footprint, whether here or they’re growing stores around the country. They’re headquartered here and you think about engineers, business executives, all those nuts and bolts, human resources, legal, medical – we have it all in Georgia.”

Supporting Zaxby’s Investments in its Employees

Zaxby’s CEO, Bernard Acoca, discussed how private equity helped Zaxby’s reach significant milestones, drive new restaurant expansions and launch new employee benefits including an expanded 401(k) program, equity stakes, and childcare support. “Private equity investment helped us enhance many benefits that weren’t currently in place. Some quick examples are our 401(K) plan, which used to take a year to enroll in that program. Today, there are only 90 days before you can enjoy the benefits of that program. We’ve increased the company match associated with that program, and immediate vesting wasn’t taking place before. Another example, childcare benefits. We expanded how many people were eligible for it and increased the amount. But I think really the real benefit of private equity ownership in this particular case was that we were able to offer a significant portion of our employee base an equity stake in the company so that they could help that could actually enjoy the wealth creation that is being created as we continue to grow this amazing brand.”

Growing Hilton into an Internationally Recognized Brand

The event was held in a Hilton Hotel – which is a company that has benefited from private equity investments to grow into the internationally recognized brand it is today. AIC CEO Drew Maloney shared this story: “The Hilton story is one of those typical private equity stories that really explain what we do and our positive contributions to the economy. In 2007, Hilton was this sort of a tired brand that needed to really get some new energy around it. And then private equity, Blackstone came in, bought the company, took the company private, put new leadership in, and hired a new CEO that is with them today… Blackstone held this investment for 11 years and worked side by side with the management team, not only investing new capital but also working with the team to figure out how to refresh that brand. And over those 11 years, they doubled the number of rooms, expanded to new brands, and set up a company that is now one of the top global hotel brands.”

Investing in Beloved and Well-Known Businesses Across Georgia

Most Americans may not realize that many of their favorite businesses benefit from private equity investments. AIC CEO Drew Maloney highlighted this reality, “We have more than 350,000 workers here. More than 400 small businesses [in Georgia] get private equity backing. I think one of the challenges with private equity is that not everybody knows that the companies on Main Street are owned by private equity. So you’ve got companies like Zaxby’s, you’ve got landscape companies, you’ve got water infrastructure companies, you’ve got collision repair companies, all these companies. These 400 companies across Georgia all get capital from private equity to help them meet their needs and grow and become really vibrant businesses.”

GA Businesses Also Benefit from Private Credit

AIC CEO Drew Maloney discussed how private credit has emerged as a critical source of financing for small businesses unable to access loans from traditional banks, “small businesses across Georgia and America are looking for capital to succeed and grow. Private credit is simply an alternative to bank financing that a lot of companies need to use, and it really is effective in two ways. One is flexible financing … I think the second and very important point that Bernard talked about is the partnership, which is that the private credit funds and the private equity funds have professionals across the workstream who have worked in businesses and partnered with the companies to help them work through the economic challenges they face. And I think that’s a real difference in what private credit offers.”

Click here to watch the full event hosted by Punchbowl News.