Why Creek Equity Holds Companies for the Long Term
We invest our own capital, so there is no fund clock telling us when to sell. Here is why that matters to the companies we own.
Most investment firms that buy companies have a deadline. They raise a fund from outside investors, and that fund has a life of roughly ten years. Somewhere in the middle of it, every company they own has to be sold so the investors can be paid back. That structure works well for many firms. It is not how Creek Equity works.
Creek Equity invests its own capital. We do not manage money for outside investors, so nobody needs us to sell by a certain date. That one fact shapes almost every decision we make.
Patience changes what you are willing to build
When you know you will sell in four years, the sensible thing is to make choices that pay off within four years. Investments with a longer payback, like training a new layer of managers, replacing aging equipment, or entering a new market slowly and carefully, can look unattractive on that clock.
When you expect to own a business for a decade or more, those same investments look different. You will be around to benefit from them. Many of the best decisions in a company are the ones that take years to show up in the numbers, and long-term ownership lets us make them.
It is better for the people
An owner who sells a company they built usually cares about what happens next: to the employees, the customers, and the name on the building. When I talk with founders and family owners about selling to Creek Equity, the question I hear most is not about price. It is whether we plan to flip the business.
We do not. Our plan is to own good companies for a long time and make them better. That gives managers room to plan and employees a reason to stay. It also gives customers confidence that the company they rely on will still be there.
It does not mean standing still
Patience is not the same as passivity. Long-term ownership only works if the companies keep improving. We review each business on a steady rhythm, hold leadership to a written plan, and add capital when there is a clear use for it.
Creek Equity also runs under a written Investment Policy Statement. It divides our capital into tiers with different jobs, sets limits on risk and concentration, and requires a liquidity reserve. Those rules exist so that a long holding period is a choice we make on purpose, not something forced on us because we have run out of options.
When we would sell
Holding for the long term does not mean holding forever no matter what. If a company would be better served by a different owner, or if an offer reflects value we could not create ourselves, we will consider it. The difference is that we decide based on what is right for the business and for us, not on a calendar set years earlier.
What this means for a seller
If you own a business in Michigan and you are thinking about what comes next, the structure of your buyer matters as much as the price. Ask how long they plan to own it, what they will do in the first year, and how they behave when a quarter goes badly. Those answers will tell you more about your company's future than the purchase agreement will.
For Creek Equity, the answers are simple. We plan to own it for a long time, we start by listening, and we have the patience to work through a bad quarter.
Scott Zack is an investor and entrepreneur in Bloomfield Hills, Michigan and the owner of Creek Equity. He played forward for the Ohio State men's basketball team. About Scott.