3Qs With... Joe DeSena
The founder of Spartan Race Inc. looks to bring his own brand of mud runs to more than 50 countries
Spartan Race Inc., known for setting up challenging obstacle-racing courses throughout the U.S., is courting private equity firms in an effort to expand in other countries. So far, Raptor Consumer Partners - the Boston private equity arm of Raptor Capital Management LP - acquired a minority stake in April 2012 for undisclosed terms. Spartan Race founder Joe DeSena is looking to build on that momentum, speaking at various Association for Corporate Growth events such as ACG NY On Tap and the 8th Annual Northeast ACG Stratton Ski & Conference. The races - 3-mile sprints, 8-mile Olympic distance "supers" and 10- to 12-mile "beast" courses - require competitors to run, jump and swim their way through mud and a dozen or so obstacles (rope-climbing and crawling under barbed wire). The Raptor deal has allowed Spartan Race to leverage some PE expertise, but DeSena is looking for more. Spartan Race, also based in Boston, has already made its way to various emerging markets, says DeSena, who created the company in 2010. Previously, he was a managing director of brokerage firm Tullett Liberty's New York equity division in 2006. Before that, he was the chief executive of brokerage firm Burlington Capital Markets. DeSena spoke with Mergers & Acquisitions about how his Wall Street background shaped the company and what PE firms can do to make Spartan Race an Olympic sport.
How has your background in finance helped with the Spartan Race?
Knowledge in finance helps in all businesses. You learn how to make quick, yet thoughtful, decisions. You also learn how to make sure you do not waste money. Through my years in finance, I learned that lean is the right method for a startup. And so far in 2013, the company has seen 100 percent growth over 2012, which is exciting.
What markets are you looking to bring Spartan Race to next?
International is an incredible growth engine for us. Next we're headed to Japan, Brazil, Russia, Ireland and the rest of Europe. South Korea is all set to go. Mexico was our most exciting response. But anywhere we go comes at a giant expense. You got to let people know who you are, what the brand is and why they should pay for the product.
Can private equity help?
With private equity, it is less about cash and more about expertise. Whether we like it or not, the world is a digital place. Between email segmentation, analyzing data or executing the 10 different social channels that are out there, our frustrations are centered on executing the digital space. Imagine doing excavation work with a pick axe and someone asking for a bulldozer. We need people who are incredible savvy in the digital space and can leapfrog the business. Raptor's expertise in brands and sports can help take us to the next level, which includes bringing this sport to the Olympics and being known and operating in at least 50 countries. I'm 100 percent serious. Our long-term vision is to have it up there with ping-pong and curling.