BY JOHN PLETZ

After almost a half-century of wheelingand dealing, Dick Kiphart could be slow-ing down.But he’s not.The 73-year-old banker has become one

of the most active angel investors inChicago startups, with a dozen deals lastyear ranging from an education-technolo-gy fledgling, GetSet, to a new health-datacompany, PhysIQ. “If I was playing golf with all the old

guys, we’d be talking about FranklinRoosevelt,” Kiphart says. “I love theseyoung kids and like what they’re doing.You hope you’re going to make somemoney, but it’s fun talking to these youngentrepreneurs doing tech stuff.”For the past decade, Kiphart and his

son-in-law, Chris Capps, have been doingbusiness as KGC Capital. They’ve madetraditional buyouts, such as the $100 mil-lion acquisition of Ranir, a manufacturerof toothbrushes and dental care productsin Grand Rapids, Mich., in 2009. But theirfocus is on startups, which account for 25of their 38 deals. Twenty of them are inChicago, where Kiphart, a Milwaukeenative, has been a banker and wealth manager at William Blairsince graduating from Harvard Business School in 1965.The long list of deals belies the firm’s low profile. Its website is

a screen that’s blank except for a logo and email contact in tinytype. KGC Capital has no Facebook page. Kiphart doesn’t tweet.Kiphart fits in with shy-guy angels—men like trader Don

Wilson (DRW Ventures), Jump Trading founders Paul Gurinasand Bill Disomma (Jump Capital) and Huron ConsultingGroup founder Gary Holdren (Garland Capital)—who arespending at least some of their fortune on tech startups, provid-

ing the companies the means to launch and prove their worth. These early stage investors typically have much smaller

bankrolls than traditional venture funds and therefore makesmaller investments. KGC generally invests between $750,000and $1 million, though it has written some checks twice thatsize. But angel investors have an edge: Because they don’t haveto get a committee’s permission to act, they move quickly.“We had a yes and an amount in a month—that’s the fastest

check we got from any investor,” says Karan Goel, founder ofGetSet, which raised $2.5 million from KGC and others last year.

CHICAGOBUSINESS.COM | FEBRUARY 9, 2015

He’s at home with the kidsBanking veteran Kiphart is one busy angel investor in tech

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Dick Kiphart is one of Chicago’s most active angel investors in technology startups.

CHICAGOBUSINESS.COM | FEBRUARY 9, 2015

Capps, 32, recalls coming home from a visit to Ranir and driv-ing to Kiphart’s downtown home to recommend they do thedeal. Kiphart sized it up and, unable to find a piece of paper,wrote up their proposal on a napkin. “He’s ready to go all in allthe time.”Kiphart clarifies, though, that speed doesn’t mean he’s jumping

blindly into deals: “We’re very disciplined on pricing,” he says.

The payback by being early is that KGC can get a muchbigger return. Kiphart points to his investment a decade agoin Emmi Solutions, a Chicago-based health care tech compa-ny that was bought two years ago by Primus Capital, a pri-vate-equity firm in Cleveland. “We were the first money in,”he says. “It stumbled for a long time. I kept my money in,and it looks like it will be a two- or three-bagger.”Kiphart joined William Blair’s brokerage operations in 1965,

becoming an investment banker in 1980. He headed Blair’s I-banking division from 1995 to 2009 and then ran its wealthmanagement business.

BUILDING A FORTUNEHe made his fortune, which easily tops a half-billion dol-

lars, by investing his own money in such Blair deals asConcord EFS, a Memphis, Tenn.-based payment processingfirm that was sold to First Data for $7 billion a decade ago,producing $400 million for him. He also scored $100 millionwith a timely investment in Grifols, a blood plasma makerbased in Barcelona, Spain, before it went public in 2006 in a$1.3 billion IPO. Not every deal he has touched has turned to gold. Kiphart,

like Gov. Bruce Rauner, a former private-equity investor, was aboard member of Divine InterVentures, Chicago’s most infa-mous flameout in the dot-com bust at the turn of the century.The deal wiped out Kiphart’s $1 million investment. Another whiff was Nature Vision, a Brainerd, Minn.-based

maker of underwater camera gear that fizzled in the recession

after merging with a Kiphart-backed company. Even so, NatureVision founder Jeff Zernov says he still calls Kiphart with ideas.“He’s just a class act,” he says. “Show him a balance sheet, and hecan dissect the company in seconds.”Kiphart is legendary at Blair for his sense of humor, work

ethic and, for the longest time, his perpetually untucked shirt.“He has more energy than any three 30-year-olds,” says JohnEttelson, who worked for Kiphart in the 1990s as an invest-ment banker at William Blair and now is its CEO.Balding, bespectacled and always self-deprecating,

Kiphart still refers to himself as a “peddler,” even though he’sa member of Blair’s management committee and now is apartner and senior adviser. Though Kiphart showed up at Blair with an Ivy League pedi-

gree—before receiving his MBA from Harvard, he earned abachelor’s degree in engineering from Dartmouth College—he came from a humble background. He’s quick to point outthat his dad was a steeplejack who never graduated from highschool and his mom had an equivalency diploma.He and his wife, Susan, also are involved in civic efforts. He

has chaired or served on the boards of the Lyric Opera, thePoetry Foundation and Columbia College Chicago.The result, Ettelson says, is “a great Rolodex” that includes

Margo Georgiadis, a top Google executive (Kiphart met heryears ago at their North Shore church), Andreas Cangellaris,dean of the engineering college at the University of Illinois atUrbana-Champaign (they talk tech over lunch in Greektown),and Mayor Rahm Emanuel (Kiphart co-chairs a $38 millionfundraising campaign for arts in Chicago Public Schools).His contacts extend beyond Chicago. His college roommate

was Lou Gerstner, who went on to turn around IBM. Kiphartwas singled out in Warren Buffett’s annual investor newsletterin 1997 for making an introduction to the Minneapolis-basedowners of Dairy Queen that led Berkshire Hathaway to buy thefast-food company.Kiphart’s presence can open the door to other investors,

says Stuart Larkins, co-founder of Chicago Ventures, who hasinvested with KGC in four deals. “He’s a great name to have onyour (capitalization) table.”Kiphart dismisses the idea of having achieved any great wis-

dom but acknowledges a certain “benefit of hanging aroundthe hoop.” It is a good place, after all, to score.

Contact: jpletz@crain.com

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This information has been prepared solely for informational purposes and is not intended to provide or should not be relied upon for investmentadvice. The factual statements herein have been taken from sources believed to be reliable, but such statements are made without any representa-tion as to accuracy or completeness. Opinions expressed are current as of the date appearing in this material only.

KIPHART IS LEGENDARY AT BLAIR FOR HISSENSE OF HUMOR, WORK ETHIC AND, FORTHE LONGEST TIME, HIS PERPETUALLYUNTUCKED SHIRT.