VSS Capital Partners’ Portfolio Company HFW Reaches Milestone of Adding 10th Partner Firm

Capitalizes on Growth Opportunities of Highly Fragmented AE Market

VSS Capital Partners ("VSS"), a lower middle market focused private investment firm that for over 30 years has partnered with founders and management teams of companies to support their growth, today announced that its portfolio company, The HFW Companies ("HFW"), has completed the acquisition of its 10^th strategic growth partner to its own platform. Financial terms of the transaction were not disclosed.

HFW, with VSS’s support, has acquired Southwest Engineers, a Texas-based civil engineering firm that specializes in wastewater treatment and water storage for public and private clients. This latest deal further expands HFW’s reach into specialty, resilient, high-growth architecture and engineering (AE) services in attractive geographies.

HFW, with continued financial and strategic support from VSS, employs a “house of brands” growth approach, wherein acquired partner firms maintain their individual brand identities and operational independence. At the same time, the partner firms benefit from shared services and resources provided by HFW’s scaled operational platform, including integrated back-office infrastructure such as talent recruitment, HR management, employee benefits, cross-selling, and work sharing.

“VSS’s support has been instrumental in refining HFW’s overall strategy, helping us identify and execute meaningful growth opportunities,” said Michael Hein, CEO of HFW. “VSS has been much more than a capital provider to us—they are a strategic partner bringing their resources and guidance to help the management team execute on the strategy. We look forward to continuing to build out the platform’s capabilities, geographies and services for the ultimate benefit of our clients and partner firms.”

VSS prides itself on supporting growing lower middle market businesses with flexible capital solutions; for HFW, VSS’s partnership enabled management to execute a disciplined, low-leverage buy-and-build strategy to support acquisitions and accelerate platform expansion. Since VSS’s initial investment in 2021, HFW has meaningfully scaled its team, now employing 500+ employees across the entire platform. In addition, HFW’s annual revenues have experienced meaningful organic and M&A growth, reflecting the successful execution of its strategy.

“We see substantial potential to continue to scale HFW’s platform. In a highly fragmented market, HFW has established itself as the acquiror of choice due to its honesty, transparency, and track record of empowering and enabling its partner firms,” shared Sai Parepally, Vice President at VSS.

HFW seeks to build a platform insulated from cyclical market disruptions while also prioritizing exposure to the highest growth regions of the US. The platform has actively prioritized serving a wide-ranging client base including municipal, education, healthcare, commercial, and residential customers, across a wide range of complementary service offerings including civil engineering, architecture, land surveying and more. This approach strengthens the platform’s member firms by mitigating concentration risks and enabling resource-sharing when needed.

“HFW’s most recent acquisition of Southwest Engineers is a testament to the platform’s innovative and non-disruptive business model, led by an exemplary management team,” added Rhodes Garner, Senior Associate at VSS.

UB Greensfelder served as legal advisor to HFW.

About VSS Capital Partners

Headquartered in New York, VSS is a private investment firm that invests in healthcare, business services and education companies. Since 1987, VSS has partnered with lower middle market companies, working closely with management teams, to facilitate their next stage of growth. VSS provides capital for growth financings, recapitalizations, strategic acquisitions, and buyouts with the flexibility to invest control or non-control capital, based on the needs and objectives of each company. VSS has managed $4 billion in committed capital across 8 funds and has completed 102 platform investments and over 600 add-on acquisitions. For more information, visit https://www.vss.com/

About HFW Companies

Based in St. Louis, HFW is an AE industry professional services company investing in architecture and engineering firms who serve metropolitan and infrastructure markets and are open to aligning with a partner for growth. Our member firms, grounded by technical excellence, solve the most important problems facing our built environment, making communities better through creative design, engineering, and planning. For more information, please visit: www.hfwcompanies.com

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