Virginia-based Custom Ink, known for its quick-turn, small batch personalization of T-shirts and other items, has entered into a deal led by private equity firm Great Hill Partners to recapitalize the company. Current shareholders, including Revolution Growth – which is headed by Washington Capitals and Washington Wizards owner Ted Leonsis – and SWaN & Legend Venture Partners are exiting their Custom Ink investments. Marc Katz, Custom Ink’s co-founder and chief executive, will continue to run the firm and own a significant stake in the business.

Marc Katz

“This is a really important milestone for Custom Ink,” said Katz. “It’s a testament to the great work of our team over the past 19 years, and it positions us well for the future. Great Hill in particular has an outstanding track-record of enhancing ecommerce and direct-to-customer companies that are similarly passionate about marketplace and workplace excellence. I think they’re an ideal partner to help us continue to build out our unique brand, offering, and platform.”

Among the brands that Great Hill has backed over the years are Wayfair, Bombas and The Shade Store. It has raised over $5 billion in commitments since its inception. “Custom Ink helped pioneer online customization and has created the industry's leading end-to-end digitally-powered platform for customized apparel,” said Michael Kumin, a Managing Partner at Great Hill Partners. “This is a terrific brand with outstanding operations in a highly-fragmented category where we see huge growth potential for the company.”

“This is a really important milestone for Custom Ink. It’s a testament to the great work of our team over the past 19 years, and it positions us well for the future.”— Marc Katz, Custom Ink

Added Leonsis: “When Revolution first invested in Custom Ink in 2013, we were impressed with how the company was using technology, combined with a passion for service, to revolutionize the custom apparel category and bring people together. We saw power in Custom Ink’s community-driven growth model, and this has proven to be a very successful investment. We’re proud of our role at Custom Ink and think Great Hill will be an excellent partner for the company’s next stage.”

In an interview with The Washington Post, Katz said Custom Ink is profitable and financially healthy, calling the deal a “liquidity event” that let investors and some employees cash out options and stock. Katz told The Post: “There isn’t a need to put capital into the company.”

Custom Ink, which employs 1,700 people in five locations, has annual revenue of $400 million. The company was founded in a basement in Maryland in 2000 and today has a market value of $500 million, according to analyst estimates.

The deal is expected to close next month. Investing alongside Great Hill is HarbourVest Partners, with Guggenheim Securities LLC and DLA Piper advising Custom Ink on the transaction.