Private Equity Case Study: How PCM Encore Helped Shape Hawx Smart Pest Control into an Industry Leader

At PCM Encore, our clients have access to a wide range of differentiated private market offerings. We believe private equity presents attractive opportunities to provide clients with diversification from periods of public markets volatility combined with the potential for strong, long-term growth. Our team, with deep expertise in private markets and a rigorous due diligence and asset selection criteria, establishes partnerships with a high-caliber bench of portfolio companies for our clients. Read more below to learn about how we put this approach into practice – and helped shape an entire company into an industry leader.

The Backstory

In 2021, PCM Growth, the private equity arm of PCM Encore, made a direct investment in Hawx Smart Pest Control, a Utah-based pest control company servicing primarily residential clients across the American Midwest, West Coast, and Southern regions. At the time, we identified Hawx as a small but appealing company that had a path to reach its full value potential – as revenue growth had slowed for several years, and the company’s business model, while steady, was not making use of the wide range of client-facing technologies that could boost customer retention and diversification of services. Despite Hawx’s regional diversity, the company did not have a digital marketing strategy at the time, missing out on a large sales channel opportunity to drive further customer growth. With PCM’s background and experience in technology from Michael Paulus’ prior ventures, we saw an opportunity to come in and revolutionize Hawx’s business and disrupt the pest control industry more broadly.

Identifying Opportunities and Implementing Change

Leveraging our rigorous due diligence and top-down financial analysis, we identified a variety of opportunities to accelerate Hawx’s growth and customer offerings. Our team successfully launched the company’s inside sales processes, leveraging innovative digital capabilities to push beyond the regional limits of in-person and door-to-door marketing. This year, we expect to add over 10,000 customers via this channel alone, which did not exist when we acquired Hawx. In partnering with Hawx, we have also helped build out the company’s proprietary growth and support their suite of technologies, including Hawx Hub (centralized knowledge library), Digitaltech (client service application), Blackbird (end-to-end sales platform), Mercury AI (customer smart scheduling application), and Hawx Central (AI-powered customer support tool). These tools are designed to not only help our sales team target customers more likely to retain with Hawx, but also greatly improve the customer experience, with seamless sign up and scheduling processes to reports that are generated after each service with photos of the services performed (one of the largest pain points in pest control is that customers typically cannot see the invisible services performed, so we aimed to change that to increase customer satisfaction).

These innovative software solutions helped modernize and overhaul Hawx’s more dated CRM model, which not only improved customer experience and troubleshooting, but also streamlined Hawx field technicians’ daily operations – ultimately improving route density, stops per day, and customer retention. These new offerings enabled Hawx to rapidly open new branches and expand across the country, unlocking significant new customer pools in densely populated regions ripe for pest control needs.

Hawx Smart Pest Control: Present Day Performance and Outlook

PCM Encore’s financial expertise, technological prowess and experience building world-class companies helped drive company revenue from $30 million in 2021 to over $100 million in 2024 – reflecting a 40% compound annual growth rate (CAGR) from FY20 to FY24.

Hawx’s impressive revenue growth sets the stage for an even brighter future: The company boasts a 90+ net promoter score and superior ratings across multiple community platforms, supporting our prediction that its growth is poised to continue as current customers bring in new business. Since its acquisition by PCM, the data shows that Hawx’s increased profitability is directly linked to its enhanced customer service offerings and streamlined operational capabilities that allow technicians to complete a greater number of services per day while maintaining high levels of customers satisfaction. Today, Hawx operates 17 services centers across four regions and employs a team of nearly 400 full-time technicians across its four regional markets, and we only expect its national exposure to continue growing.

At PCM Encore, we often describe ourselves as providing our clients with “high conviction” private market offerings. While this strategy has resulted in strong investment performance, baseline return metrics cannot sufficiently capture the diligence and consideration that goes into our team’s decision-making process before opening our offerings to outside capital. Investing with PCM Encore through our strategic partnerships and acquisitions means investing alongside professionals with a track record of hands-on investing and management experience committed to building a high-quality private market portfolio.