November 15, 2023
It’s that time of year, to reflect back upon the many successes in the Venture Capital and Private Equity industries, in addition to honoring those who have worked toward that success, in 2023 and beyond. Kirkland & Ellis LLP will present the annual IVCA Awards Dinner, taking place on Monday, December 4th, 2023, starting at 5:30pm at the Four Seasons in Chicago. The honors conferred will include the Venture Capital Portfolio Company of the Year, the Private Equity Portfolio Company of the Year, and Richard J. Daley Award.
The Richard J. Daley Award – which acknowledges a single individual who has given direct and extraordinary support to the State of Illinois by participating in or being an advocate for the Venture Capital and Private Equity industries – will be presented to Jennifer Steans, President and CEO of Financial Investments Corporation (FIC), which oversees the private equity investments of the Steans family office operations. Ms. Steans has also served as Chairperson of the IVCA from 2021-22.
Ms. Steans earned a Bachelor of Science degree in Mathematics from Davidson College, and an MBA from the J.L. Kellogg Graduate School of Business at Northwestern University. Prior to founding FIC in 1994, Ms. Steans served as Treasurer of Prime Graphics, Inc. and as a Senior Consultant, and then as a manager, for the Management Consulting arm of Deloitte & Touche, primarily in the finance and health care industries.
Her business affiliations include serving as a Director of Valley National Bank, as well as past Chair of the Board of Directors of USAmeribancorp, Inc., a privately held Tampa Bay area middle market bank. She also currently serves as a Director for Arabella Advisors and Laramar. Ms. Steans is on the Advisory Boards for 5th Century Partners, Massey & Gail, Prairie Capital, and Siena Capital Partners.
Ms. Steans actively helps lead several nonprofit entities, currently serving as Chair of the board of Navy Pier, Life Trustee and past Chair of the Ravinia Festival. Ms. Steans also serves as a Trustee for the Steans Family Foundation, DePaul University, Rush University Medical Center, World Business Chicago, The Civic Federation, The Commercial Club of Chicago, Phoenix Pact, and the YWCA of Evanston/North Shore.
Jennifer Steans was named one of American Banker’s 25 Most Powerful Women in Finance. She resides in Chicago with her husband, Jim Kastenholz.
In honoring Ms. Steans, Avathon Capital Managing Director Shoshana Veronica said, “One of the most impressive aspects of Jennifer’s character is her commitment to ethical standards. She conducts herself with integrity, both personally and professionally. Her honesty, transparency, and adherence to ethical principles serve as a shining example to others in the field. Jennifer’s reputation is well-known and respected within the industry.”
The IVCA got the opportunity to interview Jennifer Steans about her remarkable and influential career, in the following profile.
IVCA: Up to the point in which you founded Financial Investments Corporation, what in your early career provided the experience that proved valuable when you were launching FIC?
Jennifer Steans: Before business school I was a high school math teacher for two years, which really helped me to understand that to get through to students with different learning styles, I needed to change my approach based on the student.
Then, right before starting FIC, I helped my cousin secure equity and debt financing to acquire a small printing company, Prime Graphics. I served as his CFO/COO for about one-and-a-half years before launching FIC. Getting hands-on experience with both the financing and working in a manufacturing environment proved incredibly valuable as we started to pursue direct investment opportunities. I also served on his Board of Directors and developed the financial reporting package for the Board.
IVCA: You began FIC with your father in 1994. What goals did you have at the time of your origin, and how has the expansion of the corporation actually exceed what those initial goals were?
Steans: We started as an investment operation and began offering more traditional family office services about five years later. Our goal was to diversify out of our public stock portfolio – which was heavily banking oriented – into privately held relationship-based, control-oriented investments while earning above market returns … we have always targeted a 25% IRR on our direct investments.
We learned the PE industry by making key investments in first-time funds – Prairie Capital, Willis Stein & Partners, Arbor Private Investment, Waud Capital and Linden to name a few – and grew our own investment team over time. Since inception, we have sold 95 direct PE investments that generated a 3.1x MOIC and a net 26% IRR to our investors, and have grown our outstanding portfolio from $60 million at the end of 1995 to over $1.1 billion today.
We currently have 24 portfolio companies and a 14-person investment team. I don’t think I would have ever dreamed about having such a talented group of CEOs and investors. But the thing that makes me most proud is the values alignment within our entire ecosystem. Our team’s purpose statement is to invest in relationships so that people can prosper, and they live up to that mantra every day.
IVCA: How did you and your family’s background in banking help to establish the structure and type of investments that FIC engaged in?
Steans: Our family’s banking background proved key to our success. As commercial and relationship bankers, we had access to many founders who either lacked succession plans or were looking for growth equity to expand their businesses. We were able to use our commercial banking relationships to get introductions to many of these successful entrepreneurs. Rather than approaching entrepreneurs with a specific structure in mind, we would find out what their objectives really were and what was most meaningful to them, and then determine a structure that made sense. That would typically involve the founders maintaining a 20+% ownership of their company.
We don’t have a fixed time horizon for our investments. Instead, our ‘claim to fame’ is that once we have the right management team in place – there always has to be the right to make changes to the team, if necessary – we will back them until they want an exit, and then we’ll exit with them. We’re hyper-focused on alignment of interest, and can think of no better way to ensure that we have it.
IVCA: You and your family’s association with DePaul University is well established. What value do you put in education as life changing for you as a trustee in expanding DePaul’s reach and influence?
Steans: This is an example of practice when we first got to know DePaul University, at the time our Steans Family Foundation started an ‘I Have a Dream’ program in Chicago. We promised a class of sixth grade students at Schneider Elementary School that we would pay their way through college if they graduated high school. DePaul then partnered with us to provide the location and support with summer programming for these students.
We saw first hand what an incredible job DePaul does in graduating first generation college students. Greg Darnieder, our first Executive Director, would always say, “you can’t be what you can’t see.” DePaul enabled our students to see what life would be like on a college campus, as well as those students learning about so many different career opportunities. DePaul’s focus on service learning helps ensure that its graduates leave with a sense of purpose bigger than themselves, and I see this trait in so many DePaul University alumni.
IVCA: You were chairperson for the IVCA recently, and while in the position you were a prime mover of expanding Diversity, Equity and Inclusion (DEI) initiatives, both in the IVCA and FIC. Why are these initiatives important to you, and how does expanding DEI in the VC/PE communities make them stronger?
Steans: I am a big believer that we achieve better outcomes when we have a broad set of diverse viewpoints informing our decisions, and the data proves that out. This is true whether we’re talking about a PE/VC firm or one of our portfolio companies. For us, having an investment team that reflects our demographic, cultural and geographic footprint also helps ensure that we see the widest funnel of opportunity.
Finally, I would just add that our next generation of investors, entrepreneurs and CEOs will be more focused than ever on DEI initiatives, particularly that in practicing these rights it allows folks to feel a sense of belonging in whatever firm they are part of, and this is critical to retaining strong employees.
IVCA: You and your family have a long history of philanthropy in the Chicago area. What motivates this giving back to the community, and what benefits have you received from the various non-profits and other entities you’ve participated in?
Steans: I always start with how lucky I was to have my father as a role model, who raised my two sisters and me with the three core family values of work ethic, stewardship and social responsibility. I try to bring these values to everything I do, and believe there is no greater joy than helping others succeed.
Chicago has been wonderful to me and my family and I believe that we must do all that we can to make sure that all of our citizens have access to the same educational and other opportunities that we had. Whether it’s my work with our foundation in North Lawndale and North Chicago, Navy Pier, Rush or the Commercial Club, trying to help reduce the wealth gap is at the forefront of my thinking and how I spend my time.
IVCA: As the 2023 recipient of the Richard J. Daley Award, what does it mean to you personally to be recognized by your peers in the Venture Capital and Private Equity industries?
Steans: Chicago has such an amazing ecosystem of VC and PE investors and I have learned a great deal from so many of them. It’s a true honor to receive this recognition and I am proud to have such an amazing group of peers in our great State.
Kirkand & Ellis LLP presents the 2023 IVCA Annual Awards Dinner on December 4th, 2023, at the Four Seasons Hotel in Chicago. For info and updates, click here.