Granite Creek’s Pete Pacelli on private equity, agribusiness and military service

Pete Pacelli was in a rut. Just months after graduating from Yale and joining Bank of America as an analyst on its high-yield sales desk in New York City, the 2007 financial crisis engulfed Wall Street. The Chicago native was feeling disenfranchised. It was a depressing time to be working in finance. He needed a change – desperately.

The change he made started him on a path that eventually led to current employer Granite Creek Capital, where he leads an agribusiness strategy – and was recently promoted to managing director. It’s among the topics discussed as he becomes the latest entry in our Dealmakers to Watch series.

Pacelli found the change he needed in two outlets – private equity and military service. In 2009, he made a beeline to his beloved hometown to work as a senior associate at mid-market PE firm Wind Point Partners. At the same time, he joined the US Navy Reserve.

For Pacelli, it scratched off two items on his checklist: working in private equity and living a life with a purpose he found previously lacking.

“I just wanted to do something that was service-oriented but would also allow me to develop different kinds of new leadership skills in different directions and get out outside the New York bubble that I wouldn’t come across in my professional life,” said Pacelli. “I was always interested in foreign policy and international relations. It was a great opportunity to hit all the boxes I wanted to achieve. I served with hard-working people and did interesting work along the way.”

He pursued both his lives in private equity and the Navy Reserve – as an intelligence officer – for eight years concurrently. It was intensive and demanding, a whirlwind for sure, but he made it happen.

“I would leave work on Friday and spend the weekend at the Great Lakes Naval Base supporting our command that was based in England,” recalled Pacelli. “And then I’d drive back Sunday night and be back in a Monday morning investment meeting.”

In 2012, he took a two-year career break to pursue an MBA degree from the University of Chicago. After graduation, Pacelli teamed up with a local family office and founded Victory Views, a managed services business serving the education industry. That reaped considerable rewards; however, he would be drawn back to private equity’s fold, joining Knox Capital in 2018 as a principal.

“I was looking for an opportunity to work on multiple deals and portfolio companies versus spending 100 percent of my time on a singular business,” said Pacelli. “The business was in a place at that time that it could be run by a new manager, so I moved to the board and jumped back into an investment role where I could work with several new industries and management teams.”

There, he came to know the partners at future employer Granite Creek, with the firms working on a few deals together. The more Pacelli learned about Granite Creek, the more impressed he was with the lower mid-market buyout shop, particularly its predilection for entrepreneurs.

Under pressure

When Granite Creek approached Pacelli with an opportunity to lead a new agribusiness strategy, he was intrigued. He may not have had a background in agribusiness, yet he did have an ace up his sleeve: his extensive PE investing experience, which only sweetened the job offer. And of course, the Midwest lineage didn’t hurt. He joined the PE firm in 2023.

“[Our] agribusiness strategy centers on investing in operating businesses that support crop and farming efficiency,” he said. “Farmers are under pressure. We are investing in companies that are providing farms with the tools to do less. Everything we look at is through the lens: do these products improve productivity, increase yields and create efficiencies for people growing crops or raising animals?

“Additionally, putting aside the fact that it was an interesting thesis and that Granite Creek had good credentials to execute the strategy, we observed world communities and agribusiness companies are underserved by institutional capital, especially in the lower middle market.”

Among the most noteworthy deals he’s worked on at Granite Creek was the firm’s 2024 investment in Global Animal Products (GAP), a maker of feed additives for the beef, dairy and poultry markets based in Amarillo, Texas.

“What the company needed was capital to invest in sales and marketing and in additional R&D trials,” explained Pacelli. “They were also looking for capital to invest in M&A and diversify their product line.”

The investment also supported a management buyout.

“It’s a good case study on how we can be creative and flexible in a way that meets the goals for the founder and Granite Creek,” said Pacelli. “GAP’s founder [Ken Ridenour] was looking for liquidity but he also wanted to find a way to reward his employees for their hard work and loyalty. He wanted a role in his investment going forward. Granite Creek was able to deliver on our partner’s ask in a way that worked for everyone.”

As for how AI is factoring into Granite Creek’s dealmaking, Pacelli said the firm’s still in learning mode.

“At Granite Creek, we’ve been exploring some AI-enabled products from deal-sourcing tools to research tools – products that can help with underwriting analysis and talent management. Many of those have shown real promise in helping us work faster and smarter.”

This is trickling down to Granite Creek’s portfolio companies.

“We also see it as our job to cross-pollinate best practices at those companies,” added Pacelli.

Small world

When Pacelli is not helming deals at Granite or enjoying down time with his family, he’s either fishing or playing rackets, which he described as “an old-fashioned sport that is the predecessor to squash.”

Asked if there’s a philosophy that he lives by, Pacelli invoked a time-honored adage: treat others the way you would want to be treated.

“It’s something that runs through my professional and personal life,” said Pacelli. “Being honest with your business partners, following through on your word and doing the right thing. That runs through my work. Ultimately, capital is a commodity, and this is a reputation business. Our reputation at Granite Creek is our selling point and it’s a small world. So when we are out there selling Granite Creek to founders and entrepreneurs, if that’s not backed up by credible evidence, then there’s not much to work with there.”

Editor’s note: This article is part of an ongoing series of profiles launched by PE Hub called Dealmakers to Watch. The series features private equity professionals as they pivot to new challenges, such as moving to a different firm, launching a new firm, getting promoted to partner, launching an investment strategy, closing a significant deal or some other new endeavor. If you’d like to see a dealmaker profiled, reach out to PE Hub editor-in-chief Mary Kathleen (MK) Flynn at mk.flynn@pei.group.

For more in the series, see these articles on PE Hub: