To understand the scale of Directional Aviation you just need to walk around any busy US business aviation airport.

As is most obvious, you will see a Flexjet aircraft – with an FX tail number. Most are carrying fractional and lease owners, but some aircraft which have aged out of the fractional lineup are carrying passengers who will have booked through Sentient or FXAIR. Some of these aircraft will have been maintained by Constant Aviation; flown by pilots trained by SimCom; managed by Corporate Wings; sold by Sojourn Aviation; or financed by Stonebriar Commercial Finance (where he is a minority investor). You may see re-engineered Nextant aircraft take-off or a patient being carried out of a Reva Air Ambulance.

Directional’s invisible hand reaches across the industry like no other single company. This diversity has also allowed Directional to end 2020 with a record year.

Kenn Ricci, its founder, is about to celebrate his 40th anniversary in business aviation. But has no plans to slow down. He has just floated his first public company – a Special Purpose Acquisition Company (SPAC) and is still looking to grow Directional both in the US and internationally. In 2020 it pushed on with Flexjet in Europe and launched FXAIR.

Ricci bought Corporate Wings, an operator, charter and maintenance company, in 1981. Mike Rossi joined as chief financial officer (CFO) in 1984 and the pair started acquiring fixed base operators (FBOs) or private jet terminals. Ricci flew a lot during this time – including for Governor Clinton’s presidential campaign. In fact the campaign team leased an aircraft from Corporate Wings.

In 1998, he launched Flight Options a fractional operator that started with pre-owned aircraft and grew quickly soon ordering new aircraft. Flight Options fleet was dominated by Beechcraft and Hawker aircraft, which was at the time owned by Raytheon. In 2001 it merged with Raytheon Travel Air (and ordered $900m of new Raytheon aircraft types). A few years later Ricci offered to buy Raytheon out but was instead outbid and sold his stake.

He has often said that selling Flight Options was a mistake, but the sale led to the creation of Directional Aviation Capital. In the early 2000s private equity companies started looking at business aviation. He and Rossi were approached by several and decided to work with Allied Capital, which had ended up owning a chain of FBOs when a loan went bad. Directional took a 25% stake. Three years later Macquarie bought it for more than $600m. In 2009 it was able to buy back Flight Options.

Directional Aviation now consists of around 13 companies (it depends on how you view each division). These employ more than 2,000 people and generate more than $1.5bn in sales each year. They operate more than 175 business aircraft (and have more than 80 on order); making Directional the third largest operator by flight hours (behind NetJets and Wheels Up). It ranks higher on profit.

Directional itself has just two direct employees – Ricci and Rossi, its CFO. “It is just a lawyer and an analyst,” jokes Ricci.

“Mike and Kenn are very yin and yang,” says one business aviation veteran who knows them well. “They have very different outlooks, which is why they are such a strong combination. Kenn has a lot of vision but Mike is also very good at focusing it.”

“Kenn has a lot of qualities and one of these is hiring great people.”

Managing the business

Ricci says that Directional’s strength comes from the managers that run each business. “Every company has its own CEO,” he says. “We only get involved in three things: the strategic vision of the company – which can be based on monthly, or weekly meetings depending on the size of the business – capital decisions; and executive compensation.”

Bonuses are based on return on capital invested. “Mike Silvestro [CEO of Flexjet] can’t just buy a billion dollars of aircraft to grow revenues,” says Ricci. He says the company has a mid-teen hurdle rate.

People who attend these meetings say they can be intellectually exhausting. “Kenn has a lot of qualities and one of these is definitely hiring great people,” says one executive who has worked with him. “If you look at the quality of his team you have people like Mike Silvestro and Megan Wolf [Flexjet chief operating officier (COO)], Andrew Collins [CEO of Sentient] and other managers that any company would want.”

The management team is a tight-knit group. Many brand CEOs have worked for Directional for many years. Silvestro was Ricci’s college roommate and joined Flight Options in 2000. Moving around the group is common. David Davies, who became CEO of Constant Aviation in January 2020, has worked with Ricci since 1997 (starting at Flight Options, moving to Mercury, then returning to Nextant and Flight Options).

“It is a close group but it also extremely friendly and welcoming to new joiners,” says Adam Twidell, CEO of charter broker PrivateFly, which was acquired in 2018. “I would say for me it was like joining a new rugby team; you are included from day one and instantly are made to feel part of the team –it was also similar to when I moved bases in the Air Force.”

While it is close, it is not a fraternity. Senior female leaders include: Wolf at Flexjet, Elizabeth Ricci, CEO of Corporate Wings; Lou Ann Brookshire, CFO of Flexjet; Deb Perelman, chief legal counsel of Onesky Flight and Marine Eugène, MD of Flexjet Europe.

“It is a really exciting culture to join,” says Eugène. “It is unique and very rare. When you visit the Flexjet head office you meet so many people who are so passionate about aviation and the company. You can tell it is different by the number of people who have worked for more than 20 years at the company.”

European staff also say they have been impressed at how Directional has recognised the cultural differences between Europe and the US. This partly reflects Ricci’s love of travelling. Each of his children have skipped eighth grade (age 13-14) to travel – he is one of a few business aviation executives to have visited North Korea.

Cheers to teamwork: Kenn Ricci (left) and Mike Silvestro, CEO of Flexjet, were college roommates before they worked together.

Ricci and Rossi are also available for support at any time. “I would demonstrate this, but it is 5am,” says Twidell. “But Kenn is always available for calls and also replies to emails quickly – not just from management but from everyone in the company.”

When Directional Aviation was in talks about buying PrivateFly, Twidell researched the company by talking to Flexjet pilots at FBOs. “I would deliberately seek them and out and ask them about working for Flexjet,” he says. “Pilots are often grumpy about employers – I know because I have been a grumpy pilot – but everyone I spoke to was always proud to work for Flexjet. They also always mentioned Kenn. They had a personal connection with him.” This is also testament to Wolf, who joined Flight Options in 2003 and was Vice President of Owner Experience after the acquisition of Flexjet. When she became COO, Ricci said to her: “Megan, we need our pilots to be as happy as our owners are.” Flight Options’ pilots unionised during the years when Raytheon Travel Air owned the enterprise.

Upon resuming ownership and merging Flight Options’ operations with Flexjet, the combined pilot group now flying under the Flexjet banner, voted to decertify the Teamsters’ Union in 2018. Flexjet pilots now have a direct relationship with management without a union intermediary.

The union had opposed Flexjet’s Red Label programme where crews are dedicated to each aircraft.

Each business is run as a separate one. While there are support sister companies, Ricci stresses that each business needs to “swim in its own lane” and not compete. Flexjet does offer some jet card programmes but only on specific aircraft models where Sentient Jet does not have cards. FXAIR, the new US brokerage business, does not compete with European-orientated PrivateFly.

Directional looks for companies that support each other or fill an unmet need in the private aviation market. Some are obvious: SimCom trains Flexjet pilots and Constant Aviation maintains some of Flexjet’s aircraft. Others are more subtle.

When Directional bought Sentient Jet in 2012 it was able to put Sentient customers on underused Flight Options aircraft (Ricci also attempted to buy Marquis Jet by purchasing its debt at the same time). The group has used this ’keep-it-in-the-family’ strategy in 2020 by allowing FXAIR, Sentient and PrivateFly onto older Flexjet aircraft that are no longer flying under fractional arrangements.

On the front step: Kenn Ricci is happy to hold profitable businesses but also to sell – when the price is right.