About a month after Mitt Romney ended his bid for the Republican presidential nomination in February 2008, his eldest son, Tagg, and Spencer Zwick, the campaign’s top fund-raiser, met with a beef company executive who had been a major campaign donor over dinner at the posh Torrey Pines resort in San Diego.
This meeting, however, was not about politics. Instead, the younger Romney, who had been a senior adviser to his father, and Mr. Zwick presented the executive, John R. Miller, with a business proposition: the opportunity to invest in a private equity fund they were starting, Solamere Capital.
Neither had experience in private equity. But what the close friends did have was the Romney name and a Rolodex of deep-pocketed potential investors who had backed Mr. Romney’s presidential run — more than enough to start them down that familiar path from politics to profit.
Two years later, despite a challenging fund-raising climate for private equity, Solamere, named after a wealthy enclave in Utah’s Deer Valley where the Romneys have a winter home, finished raising its first fund. The firm blew past its $200 million goal, securing $244 million from 64 investors, including a critical, early $10 million from Mitt Romney and his wife, Ann, and hefty commitments from wealthy supporters of the campaign.
The small firm, including Tagg Romney, 42, Mr. Zwick, 32, and a third partner they brought in, Eric Scheuermann, 47, the only one with a private equity background, is in line to collect at least $16.8 million in fees over the first six years of the fund, according to a filing with the Securities and Exchange Commission. The firm has earned a 20 percent return since 2010, despite having invested only about half of its money so far.
It is not unusual for start-ups looking for investors to approach friends and relatives. But the overlap between the elder Romney’s political apparatus and Solamere adds a different, potentially nettlesome dimension, given the widespread presumption since the last presidential election that the former Massachusetts governor was next in line for the Republican nomination.
Solamere’s founders dispute any notion that they have cashed in on their political connections, arguing that Solamere, like any fund, has had to persuade investors on its merits.
“No one we went to as an investor said, ‘Oh, your dad is Mitt Romney, I’m going to give you $10 million,” Tagg Romney said, noting that his father’s political future was uncertain when the firm began. He added, “Our relationships with people got us in the door, but that did not get us investors.”
Even so, Mitt Romney was the featured speaker at Solamere’s first investor conference in Deer Valley in January 2010. Mr. Romney, who made his fortune in private equity at Bain Capital, also gave early strategic advice.
While Solamere has not operated exactly as a subsidiary of the Romney campaign, it has seemed that way at times. The firm shared its first address with the Romney campaign headquarters in Boston. Later, the company was located in the same building as Mr. Romney’s leadership PAC, Free and Strong America, before moving to trendy Newbury Street in Boston.
When Mr. Zwick was leading Solamere’s fund-raising in 2008 and 2009, he was also raising money for the leadership PAC, which paid his finance consulting firm, SJZ, LLC, more than $425,000 during those years.
Solamere began sending offering memorandums to prospective investors in May 2008, around the time the leadership PAC began collecting checks, raising the possibility that Mr. Zwick was soliciting some people for both ventures.
Mr. Zwick insisted there was no conflict, explaining that the work he did for the political committee was relatively low-key. He said the payments to his firm went to other contractors, and that he was a volunteer.
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