The global outbreak of COVID-19 has impacted almost every investment sector. While much of this impact has been negative, the pandemic has also led investors and analysts to note certain sectors that are primed for change and growth, including supply chain technology.
In particular, there is growing investor interest in technology that is geared toward supply chain management and logistics. These technologies are necessary to meet the demands of the rapid growth of e-commerce amid the COVID-19 pandemic. As more consumers are staying home and, consequently, increasing their online shopping, the e-commerce sector has expanded. This means that businesses around the world will experience additional pressure to move goods.
This shift has triggered a flurry of investment in supply chain technology. This was specifically true of private equity, which had backed 12 deals and a total of $300 million by August 18, according to PitchBook data. Further, investors have said that they expect more deals to come in the following months, which could be a positive trend.
Firms around the world have already begun to invest in emerging and developing areas in this sector, which promise to deliver returns by meeting consumers’ needs during this unprecedented environment. With that in mind, it should come as no surprise that well-known investor and founder of Sole Source Capital, David Fredston, has led his firm to make a forward-looking investment in the supply chain and logistics industry.
Sole Source (News - Alert) Capital Acquires Dasco Label
In August 2020, Sole Source Capital, with David Fredston at its helm, acquired Dasco Label. The company is a leading provider of custom labels, imprinting, serialization, and barcode services. This positions Dasco Label to grow with the large and complex supply chain market, as these services continue to be in high demand.
Dasco Label is headquartered in Blaine, Minnesota, and has been serving a loyal customer base for more than 60 years. The company has clients in a variety of fields, including health care, retail, warehouse and distribution, and laboratory services.
Focusing on product ID labeling, wire and cable identification, material and circuit board management, and rating plate labels, Dasco boasts a diverse offering. Moreover, the company also distributes large national brand products, such as industrial labels, thermal printers, barcode scanners, label dispensers, and label software.
Sole Source Capital acquired Dasco Label through Supply Chain Services. The latter delivers innovative automated data collection services to almost 2,000 customers. The roster of services includes providing critical technology, which enables businesses to become more productive and responsive. With the new acquisition of Dasco Label, the business has expanded and grown its offerings, so customers now have access to a wider variety of advanced technology and customized solutions.
“Dasco is a valuable addition to Supply Chain Services’ product and service portfolio, and Sole Source Capital is pleased to announce this deal,” said David Fredston, Managing Partner of Sole Source Capital. “Strategic growth is a core component of our investment strategy for the company, and Dasco adds attractive complementary product lines, further bolstering its impressive asset base. Leveraging our team's strong sourcing capabilities, we have been able to continue to execute our recession-resistant investment strategy to drive growth across our portfolio, despite a difficult and dislocated market. The addition of Dasco to Supply Chain Services is a testament to the hard work of our team.”
While much of the business world faces headwinds, recession-resistant companies, such as e-commerce businesses, are likely to see continued growth. For that reason, there may be a surge in demand for the products created by companies like Dasco. Recognizing this trend, David Fredston has made an intelligent move on behalf of his company.
About David Fredston and Sole Source Capital
Before founding Sole Source Capital, David Fredston served in a number of positions at the Gores Group and the Goldman Sachs Group. In 2016, he founded Sole Source Capital with a vision for a private equity firm that would bring a quantitative and operational approach to opportunities in the lower-middle market. He is responsible for the firm’s management and strategy and also oversees all investment activities.
Sole Source Capital is an investment firm with a focus on recession-resistant industries. The firm’s advisors work with management teams to reach their goals through collaborative and high-engagement relationships.
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