IN THENEWS

Throughout 2026, new member participants in the Illinois Venture Capital Association (IVCA) will keep it expanding. These new members also will give the current membership new opportunities for networking … in addition to optimizing support and partnerships … which leads to guidance and new ideas for Venture Capital, Private Equity and the support industries.

The latest new member is the firm of the McNally Capital, which “is a transformative private investment firm that partners with founder-, family-, and management-led businesses in Aerospace & Defense and Industrial Technology & Services.”

The following is a Q&A profile with McNally Capital, which explores the firm’s background and their expectations for interacting with the IVCA.

New Member: McNally Capital
Representatives: Brooks Hulett, Senior Vice President & Brian Grogan, Chief Compliance Officer and CFO

IVCA: What is a brief history of and background of McNally Capital?

McNally Capital: McNally Capital is a Chicago-based private investment firm that partners with founder-, family-, and management-led businesses in the lower middle market across the United States and Canada. The Firm specializes in thesis-driven buyout investments in two core sectors …  Aerospace & Defense and Industrial Technology & Services. With a hands-on investment approach and a proprietary value creation framework, McNally Capital works closely with management teams in accelerating growth and building long-term value for its investors.

IVCA: Why did the firm decide to join the Illinois Venture Capital Association?

McNally Capital: McNally Capital joined the Illinois Venture Capital Association to deepen its engagement within the Midwest investment community and to contribute meaningfully to the region’s private capital ecosystem.

As an active investor in the lower middle market, the Firm values strong local networks that foster collaboration, thought leadership, and responsible capital deployment. IVCA provides a forum to share insights, identify co-investment opportunities, and build relationships with venture and private equity professionals across Illinois and beyond.

The Firm also believes in supporting the continued growth and visibility of Illinois as a hub for innovation and investment. Participation in IVCA aligns with McNally Capital’s commitment to long-term partnership, community engagement, and disciplined investment practices.

IVCA: You describe your private equity firm as partners with founder-, family- and management-led businesses in Aerospace & Defense plus Industrial Technology & Services. How did that niche develop, and has it evolved since your founding?

McNally Capital: At its core, McNally Capital was built to partner with founder-, family-, and management-led businesses. That orientation reflects the Firm’s heritage and a deep appreciation for legacy, stewardship, and long-term value creation.

The focus on Aerospace & Defense and Industrial Technology & Services is intentional. The Firm’s leadership team has spent their careers investing in and operating within these industries, developing deep domain expertise, long-standing relationships, and differentiated M&A experience. These are sectors defined by technical complexity, mission-critical products and services, and durable customer relationships, qualities that align well with the Firm’s partnership-driven approach.

Since inception, the strategy has remained consistent – combine deep sector knowledge with a hands-on, collaborative model to help strong management teams build enduring businesses.

IVCA: Another element in the firm is a self-described ‘thesis driven investment methodology.’ What is the thesis that drives the methodology, and how have it evolved since your founding?

McNally Capital: McNally Capital’s thesis-driven methodology centers on identifying durable growth themes within its core sectors and proactively sourcing businesses positioned to benefit from those themes.

Rather than approaching opportunities opportunistically, the Firm develops detailed sector theses grounded in market research, industry mapping, and engagement with executives and domain experts. These theses often focus on areas such as supply chain modernization, mission-critical manufacturing, regulatory complexity, digital enablement of industrial processes, and national security priorities.

IVCA: How has the thesis evolved?

McNally Capital: Since the Firm’s founding, the methodology has become increasingly data-informed and network-enabled. The evolution reflects deeper sector knowledge, a broader executive ecosystem, and a more structured value creation framework that supports companies post-investment. The core philosophy, however, remains unchanged: invest with conviction where long-term fundamentals are strong and partner closely with management to unlock value.

IVCA: You also tout a network philosophy in developing investment relationships, and in this networking a development of a deep ecosystem in expertise. What, in your observation within the history of the firm, is the factor that becomes most important in developing an ecosystem of trust and sound investment results?

McNally Capital: The most important factor is alignment of interests combined with consistency over time …

In founder- and family-led businesses especially, trust is earned through transparency, reliability, and a long-term perspective. Relationships in Aerospace & Defense and industrial markets are built over years, sometimes decades, and reputation matters deeply. By approaching partnerships with humility, sector knowledge, and a genuine desire to support management teams, the Firm has cultivated an ecosystem of executives, advisors, and co-investors who value collaboration.

Over time, that trust compounds. A strong ecosystem not only generates differentiated opportunities, it also enhances diligence, execution, and post-close value creation. Ultimately, enduring results are driven by enduring relationships.

IVCA: Aerospace & Defense, and the Industrial Tech & Services industries rely so much on the current wave of Artificial Intelligence and pure science to advance the ever-challenging geopolitical changes. How important is Research & Development in the the process of investment outcomes?

McNally Capital: AI and advanced technologies are increasingly shaping Aerospace & Defense and Industrial markets, particularly as geopolitical priorities drive modernization and national security investment. In the lower middle market, however, innovation is typically less about breakthrough science and more about practical application and execution.

In Defense, the U.S. government relies heavily on the private sector to move quickly and implement new technologies. We invest in businesses that provide that agility, translating advanced capabilities, including AI, into reliable, mission-critical solutions.

IVCA: How about Aerospace & Industrial markets?

McNally Capital: In Aerospace and Industrial markets, trends like automation and digitization are accelerating change, but success still depends on operational excellence and strong customer relationships. For us, R&D is most impactful when it strengthens competitive positioning within an established platform and supports durable, customer-driven growth.

IVCA: What does McNally Capital hope to achieve in their interaction with the VC/PE community within the IVCA?

McNally Capital: McNally Capital views IVCA as an opportunity to engage more deeply with the Illinois investment community and contribute to a strong, collaborative private capital ecosystem.

A healthy investment ecosystem benefits not only investors, but also founders, employees, and the broader regional economy.

For the website of McNally Capital, click here.

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