Investing in Women

After shattering glass ceilings throughout her career, Leslie Frécon now is helping other women do the same

By Steve Lebeau

Leslie Frécon is managing partner and founder of LFE Capital, a Minneapolis-area growth equity firm that provides capital for health and wellness companies. As a glass-ceiling-shattering pioneer, she founded the company in 2000 after having served as senior vice president of corporate finance at General Mills (GMI), where she was both the youngest and first female executive in the company’s history. As a community and arts supporter, Frécon has served as a trustee and executive committee member of the Greater Twin Cities United Way, the MacPhail Center for Music, Breck School and the Minnesota Opera. And as a strong advocate for women, she has sat on the advisory boards of WomenVenture and the Minnesota Women’s Economic Roundtable. 

Steve LeBeau sat down with Frécon to learn more about her journey into the male-dominated world of investment firms, including the challenges she faced and the lessons she learned. Here is what she shared. 

On best-laid plans gone awry
My Shakespeare professor at Stanford University was having an end-of-graduation party for the English majors. …We were talking about next steps, and I just assumed, being passionate about English literature, that I would go to graduate school. And he kind of took me aside, and he said, “Leslie, why don’t you go to business school?” I was actually kind of offended that he thought I didn’t have the intellect to be a professor of English. He said, “No, you have very good judgment. You speak well. You write well. You present yourself well. Go get an MBA. There are hardly any women getting their MBAs. It would be a competitive advantage for you, and that is my advice.” That is what I did ultimately. I worked for a year, and then I went to business school. 

On being true to yourself
I don’t think of myself as being particularly aggressive, but [when I started my career], assertiveness from women wasn’t that common, shall we say, or a lot of men didn’t have that much experience being around women with it. I got feedback that I had to soften [my approach]. 

In retrospect, while I think everybody gets coached in corporate roles today, I don’t think that was particularly helpful in my case. To the contrary, it kind of ate away at my confidence, and it caused me to second-guess myself and my natural style. I don’t think that’s a good thing. I think people in management, while they need to learn to tune into their audience, should not be discouraged from being themselves. Everybody has to find their voice, and that’s an important part of developing confidence and trust in yourself, which is an important part of being successful. 

On taking the leap and starting her own company
I was in my mid-40s at the time. I had always wanted to do something entrepreneurial, and I thought if I waited too long I would run out of time. I figured it would take me at least a decade, if I was going to start something, to build it. And I had some financial flexibility to be able to jump off like that, because I really was jumping off into an abyss, in terms of the uncertainty. I come from an entrepreneurial family. It’s always been a value that was reinforced in my family, and it was just something I wanted to do. 

On forging strong networks
When I left [GMI], I consulted with a lot of people. I was fortunate to have a great network of relationships, and one of them is still a friend and a mentor, Leonard Harlan, who’s the cofounder of Castle Harlan, a large buy-out fund based in New York. Leonard actually put he idea of private equity into my head. He said, “You have the perfect background with your combination of finance, business operations, strategy, business acumen, your board experience.” I also had another important mentor who’s since become a dear friend, Dick Clarke, who worked with me and helped me develop a business plan to launch my firm, LFE Capital. 

“Everybody has to find their voice, and that’s an important part of developing trust in yourself and confidence which is an important part of being successful.”—Leslie Frécon

On trusting her gut
It was the most difficult thing I have ever done, raising that first fund. I had gotten tons of advice not to do this, that it would be very difficult, which obviously I did not follow. I pursued it because I really believed in the market opportunity, that businesses with women owners and leaders were a large, growing and underserved market and that I could leverage my network of relationships to find good companies. Believe me, at the time, that was not a concept that was widely understood by the male-dominated investment community. My timing wasn’t the best; I launched LFE right after the internet blowup in the early 2000s, the dot-com bust, plus I didn’t have a partner. I built the team as the business grew. Fortunately, I had a network of relationships from my business and personal lives who were people willing to back me and write checks. Wells Fargo was an early supporter, the only institutional investor in that first fund. We are now organizing our fourth fund. Our current investor base is primarily large banks, endowments and family offices that value what we’re doing to provide access to capital, create jobs through small business growth and find solutions to help people lead healthier lives, in addition to getting solid returns.

On supporting women-owned businesses
We have developed a reputation as a preferred partner for women-owned and -led businesses, and they proactively seek us out. They know about us from the networks we’ve built and by reputation. That’s a competitive advantage in the marketplace, and most savvy investors understand that. We believe today, more than ever, it is an attractive segment that offers good returns and one that is ridiculously underserved by traditional private equity. There are numerous studies that validate that businesses with female leaders, owners and founders produce higher returns and have higher success rates. And by the way, we are providing them with more than just capital. We are also bringing expertise and resources to help them scale their businesses and achieve liquidity events; they value that as much as the capital. This involves working closely with the management teams and boards, including mentoring.

On work/life balance
I’ve never been a big fan of the word “balance” because balance implies you do more of one thing and less of another. I look at it more in terms of how you integrate your personal and your work lives. And technology has enabled us to do that to a large extent. The challenge is finding a way to integrate that makes sense for you on a personal level. It means constantly problem-solving and adjusting one’s life when necessary. It’s an ebb and a flow. 

On being a pioneer
I believe that we are the longest-in-existence women-owned, private equity firm investing in the female segment. I guess you could say we are pioneers, because we were among the first and have been in business for 16-plus years. We have learned a lot about investing in this market to get to where we are today, which is very exciting because now we can leverage that knowledge to really grow. While it is still a very underserved market, more investors are interested in participating in it. Where I used to get a blank stare 15 years ago when I explained the rationale for targeting the female segment, I now get nods and recognition of the capability that LFE Capital has developed to capitalize on an amazing opportunity.