Bay Capital Mezzanine Management

John Erickson and Thomas Bozzuto serve as co-Managing Partners and lead the firm's investment committee. Erickson, a former banker, and Bozzuto, representing the founding family, jointly approve all originated investments. A small team of analysts supports due diligence and portfolio monitoring.

Bay Capital operates as a hybrid: it was initially the Bozzuto family's single-family office for mezzanine investments, but it also invests for external institutional investors and family offices. The firm does not have a permanent institutional capital base; rather, it structures each investment with a unique combination of the Bozzuto family capital and co-investment partners, effectively functioning as a deal-by-deal fund-of-funds and direct lender.

Bay Capital focuses on the lower-middle market, specifically companies with $5-50 million in EBITDA requiring $5-20 million in mezzanine debt. It targets growth, acquisition, dividend recapitalization, and refinancing transactions, typically in sponsor-backed situations. The firm generally avoids early-stage or venture deals.

Bay Capital relies on relationships with middle-market private equity sponsors, investment banks, and legal advisors in its Mid-Atlantic base. It also receives flow through its Bozzuto family network, including real estate and operating-company contacts. The firm is not a 'barbell' buyer of syndicated loans and does not compete in broadly syndicated loan markets.

Bay Capital primarily originates direct mezzanine debt investments, but it has also committed capital to select third-party mezzanine funds managed by other firms. This fund-of-funds activity supplements its direct lending and provides portfolio diversification.

Bay Capital generally avoids high-tech start-ups, early-stage biotech, pure oil & gas exploration, and consumer retail. It prefers business services, healthcare, government contracting, infrastructure, and select real estate-related mezzanine—industries where cash flows are predictable and collateral values are tangible.

The Bozzuto family wealth originated from the Bozzuto Group, a major real estate development and management firm founded in 1988 by Thomas Bozzuto. The Bozzuto Group is one of the largest privately held apartment developers in the Mid-Atlantic. Bay Capital was established to deploy a portion of this family wealth into mezzanine investments outside real estate.