The Chewy - PetSmart - BC Partners Saga (3 of 5): Who is BC Partners and does it matter? (#320)

Parts 1 and 2 of this series of posts on the Chewy - PetSmart - BC Partners Saga examined how Chewy evolved from a niche online pet retailer into a full-service pet care empire. An empire that now offers everything from pet food and toys to telehealth, insurance, and pharmacy.

Part 3 addresses the complex and revealing corporate tale behind this transformation. It’s a story not just about innovation and e-commerce success, but about strategic acquisitions and private equity ambition.

Who is BC Partners?

BC Partners is a London-based private equity investment firm, originally founded in 1986 by Otto Walraven van der Wyck.

The BC in BC Partners originally stood for Baring Capital, as the firm was created as a private equity arm of Barings Bank.

After the collapse of Barings Bank in 1995, the team at Baring Capital Investors rebranded the firm to BC Partners to reflect its independence from the bank.

BC Partners has grown into one of Europe’s largest and most influential private equity firms, with offices in London, New York, Paris, and Hamburg, and investments across Europe and North America.

As of 2024, BC Partners manages more than $40 billion in assets. Their sweet spot is large-scale leveraged buyouts, where they acquire controlling stakes in companies that can be optimized for profit, typically through restructuring, cost-cutting, and accelerated growth strategies.

The BC Partners investment model is a textbook example of the private equity playbook:

• Identify undervalued businesses with strong revenue potential.

• Take majority control.

• Drive efficiencies and boost earnings (often with aggressive targets).

• Exit via resale or an Initial Public Offering (IPO) within 3–7 years.

This short- to mid-term approach is efficient, but it’s also ruthlessly pragmatic.

In mission-driven industries like veterinary medicine, where professional autonomy and

compassionate care are critical, such strategies can create conflict.

Founder: Otto Walraven van der Wyck

• Born in May 1940.

• A member of the Dutch nobility.

• Son of Wolter Gerard van der Wijck and baroness Lily Guinevere Justine May van Heeckeren van Kell.

• His family lineage includes connections to other noble families, reflecting a rich aristocratic heritage.

• Recognized for his significant contributions to the European private equity landscape.

• He played a pivotal role in the growth of BC Partners before departing in 2001.

• Subsequently, he held senior positions at other investment firms, including Coller Capital, Climate Change Capital, and AlpInvest Partners.

• At the age of 83, he made headlines by winning his first dressage competition.

The van der Wyck family's history is marked by notable achievements across various fields, reflecting a legacy of nobility, public service, financial innovation, and sporting excellence.

BC Partners Investments

Over the years, BC Partners has made high-profile moves in diverse sectors, including:

• PetSmart (2015): Acquired for $8.7 billion - then the largest leveraged buyout of a U.S. retailer.

• Chewy (2017): Acquired via PetSmart for $3.35 billion; later spun off in a blockbuster IPO in 2019.

• Intelsat: A telecom giant whose bankruptcy under PE ownership stirred controversy

• Springer Science + Business Media, Suddenlink, NAVEX Global, GFL Environmental, Presidio ranging from academic publishing to waste management and software compliance.

Review of the Chewy - PetSmart Puzzle

After acquiring PetSmart, BC Partners recognized the threat, and potential, of Chewy, then a scrappy e-commerce competitor growing at warp speed. By 2017, PetSmart (under BC’s control) acquired Chewy for $3.35 billion in one of the largest e-commerce deals in history.

But the honeymoon didn’t last. The cultural clash between Chewy’s innovative, customer-first ethos and PetSmart’s more traditional corporate structure became evident.

Chewy outgrew its parent, and BC Partners capitalized again by spinning it off in a wildly successful IPO, effectively doubling its investment and distancing Chewy from PetSmart’s declining retail fortunes.

Rick’s Commentary

BC Partners doesn’t operate pet clinics. It operates balance sheets.

BC Partners’ business is profit optimization, not patient care.

That isn’t inherently bad, but it’s crucial to understand this when private equity firms such as BC Partners take control of essential services, especially in healthcare settings where ethical decision-making is paramount.

BC Partners plays the short-to-mid game.

The result?

• Pressure on vets to meet financial quotas.

• Reduced autonomy and rising burnout.

• Fewer independent clinics for pet owners.

• Rising prices and increased upselling of services.

BC Partners isn’t a household name, but its decisions shape how your pet gets care, what you pay for it, and how your local vet clinic operates.

The Chewy - PetSmart - BC Partners saga is more than a business story. It’s a lens on how private equity is redefining industries we once trusted to be driven by mission, not margin.

As the pet care industry becomes increasingly corporatized, this is the question we must all ask:

Are we designing systems to serve pets and their owners, or to serve investor portfolios?

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