Founder of private equity firm shares strategies for business success

Business executive L.E. Simmons advised a group of Business Honors students not to forget that good people want to do business with good people. “We have two main priorities,”� he said. “The first is to be a good partner, and the second is to be the best in our field. This means focusing on being the best versus being the largest.”�

Simmons is founder and president of SCF Partners, a Houston-based private equity firm founded in 1989 to own and build companies in the energy services industry. Before founding SCF, he helped launch the corporate Finance Department at the First National Bank of Chicago and co-founded Simmons & Company International, an investment banking firm specializing in oilfield service companies.

Simmons received a bachelor’s degree in economics at the University of Utah and the London School of Economics and an MBA from Harvard University.

Over the last 25 years, SCF has raised 8 funds, built more than 61 platform companies and completed over 290 acquisitions. According to Simmons, SCF was able to achieve such high growth through a number of core strengths: a dedication to creating great companies; an ability to adapt to changing market dynamics; growth through strategic vision and outstanding execution; and empowerment of each entrepreneur.

“Strategy is nothing but a roadmap,”� said Simmons. “Execution is how you get there.”� He walked the students through case studies of actual companies and their financials to give them a better picture of SCF’s partner companies and how they have achieved success.

According to Simmons, there are three key attributes essential to building great businesses:

• Having the right people
• Intense focus and discipline
• Working as a team toward a common goal

Simmons discussed how SCF addresses the first attribute, having the right people, by creating a rewarding work environment with diverse people and skillsets. In fact, SCF is focused on recruiting young executives to work closely with more seasoned entrepreneurs. “A variety of backgrounds really leads to creativity,”� he said. “Our employees stretch us, and we stretch them.”�

Simmons also explained what it takes to make the most effective business decisions. “The key is to have a relatively small group of people with different backgrounds,”� he explained. “It’s crucial to have an open and honest discussion when making decisions.”�

Another piece of advice Simmons offered is to make sure to partner with the right entrepreneurs. “It’s really important who your partners are,”� he said. “This is more important than the investments you’ll make.”�

Going forward, SCF plans to focus on investing in larger, more diversified global companies. Although new ventures always create some risk, Simmons advised the students not to let this hold them back in their pursuits. “You can’t be so afraid that you’re unwilling to take risks,”� he said.

Simmons left the students with one final piece of advice, saying it’s more important to know where you are headed than what will happen next. “If you know where you want to go, it’s okay if you don’t know exactly what the next step will be,”� he said. “Just focus on doing things that are right every day.”�

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