Jeff Fox's Circumference Group Keeps Focus on Investments, Growth

by Gwen Moritz  on Monday, Mar. 11, 2013 12:00 am  

Jeff Fox is no longer CEO of Convergys Corp., but the 32 months he spent running the publicly traded customer relationship management company in Cincinnati serve as an extreme example of what he is up to these days.

Fox, the former COO of Alltel Corp., identified Convergys, with which Alltel had done business, as a successful tech company whose growth had plateaued. He — or, more precisely, his Little Rock company, the Circumference Group — made a sizable investment in Convergys shares, and he finagled his way onto the board of directors in early 2009.

Convergys hired Circumference Group to consult on growth strategies and then hired Fox himself to execute those recommendations as CEO from February 2010 through October 2012.

Except for the part about becoming CEO — a lucrative assignment for Fox that was worth a few million dollars a year in total compensation — that’s exactly what the Circumference Group was organized to do: identify tech companies, both public and private, in a particular stage of development and invest in them, consult with them or both.

“We see this pattern happen, and it creates investment opportunities or sometimes consulting opportunities, and we’ve built a business around this,” Fox said in a recent interview.

The Circumference Group has set up a hedge fund — managed by CG President John Haley and registered with the Arkansas Securities Department — to invest in publicly traded companies and is just beginning to accept third-party investors. (The price tag for buying in to the hedge fund is not something the company is ready to make public, compliance officer Bud Cummins said.)

CG is also looking to buy equity stakes in established private technology firms, a function overseen by COO Holly Larkin. Like other value investors, CG expects to help the management of its investment companies maximize value. “Our reputation for knowing what this really means is growing,” Fox said.

Director of Consulting Chris Smith’s product, called the Core Value Assessment, is for sale to companies whether CG becomes an investor or not.

In all things, CG management preaches three words: Focus, simplify and execute.

So far, Circumference Group has 12 employees and has ownership positions in about 15 public companies and about five private companies, according to Fox. After spending the past three years wrapped up in the fortunes of Convergys, Fox says his goal now is “to grow our business.”

Core Value

A slide in Circumference Group’s introductory presentation makes it clear just which kinds of companies Fox and his management team are scoping out. They are companies past the startup stage of “high hopes” and even past the “feels good” stage of initial growth and financial success.

 

 

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