Polk goes PE, Pagnani takes over at Capital One

There's news in the finance and investment world today. Bill Polk, who's been running the security division of Capital One since its inception in August of 2011, is moving into the private equity world.

Polk is joining Egis Capital Partners, an investor in alarm.com. ECKey and, as of last May, CSSN. Here's a video interview I did with Egis founder Robert Chefitz in June.

Tom Pagnani, who has worked with Polk at Capital One and at CapitalSource before that, is taking over as managing partner at Capital One.

I spoke to all three this morning.

“We continue to see enormous opportunities at all levels of the capital  structure. … From my point of view [there is great] equity opportunity with fast-growing younger companies. [Working together with Robert] is something he and I have talked about for a long time. And I think it's a great opportunity to move forward,” Polk said.

Polk noted that lately the private equity community “has had a sharp focus” on the security sector, but most in PE groups are generalist who lack expertise in the physical security business. Young companies looking for PE partners can benefit from working with a group, like Egis, that has that expertise, he said.
 
Chefitz said that Egis likes to “work closely with management teams and with private equity funds that want to invest in the business.” He said he's ecstatic that Polk is joining Egis full time, noting that Polk brings experience and relationships with management teams of target investments and relationships as with other PE funds.

Chefitz said Egis is excited to continue working with Capital One.

Founded by Chefitz in 2007, Egis targets companies with enterprise values of $30 million to $200 million “that require a total investment between $10 million and $40 million.”  In addition to its investment in alarm.com, Egis closed in May on an investment in CSSN, a company that does passport and drivers license authentication and identification. “And we did that with the well-regarded Insight Venture Partners,” he said, adding that Insight has a brand new $2.5 billion fund as of this past April. Insight is an investor in Twitter and LinkedIN. “They have a tremendous brand name in technology and it's interesting that [they're investing in] security,” Chefitz said.

Egis has also “worked with Joe Grillo [former CEO of HID and Assa Abloy's global technology division] in his business activities at ACRE,” Chefitz said.

Tom Pagnani said that this move is a logical transition for Polk and said that it's an opportunity for himself and John Robuck to “continue to make the Capital One name known in the security alarm industry.”

“Egis is going to be quite active,” Pagnani said. He called Polk is a key addition to the Egis operation. "We're excited about the prospect of doing deals with Egis,” Pagnani said.