Coming from Indiana, Marshall Lynn Bass didn’t seem destined for investing in the oil and gas industry. His father was an electrical engineering professor and his mother worked in the forestry department at Purdue University.

Bass received a bachelor’s in honors economics from Purdue and an MBA in finance and operations from Rice. He almost returned to the Midwest in 1996. As Bass was preparing to graduate from Rice, he attempted to buy a truck-parts factory from a client he had advised, with the idea to expand into producing security screening materials for airports. However, fears of an eventual decline in the economy helped sink his plans.

He instead worked in the Houston office of executive search firm Ray & Berndtson as part of the company’s large energy practice. Bass made contacts and learned the basics of management teams, closing deals and other business strategies.

He then joined Weisser, Johnson & Co., spending six years as an investment banker before raising a fund that would become GasRock Capital LLC. As one of four founding principals with the fund, he has led such deals as a $100-million facility for Admiral Bay Resources Inc., a $75-million facility for Pacesetter Energy and a $75-million facility for Z2 LLC.

When not closing deals, Bass sails and enjoys his family, which includes three daughters. Having recently closed a private-equity deal, Bass spoke with Oil and Gas Investor concerning his views on the investment market.

Investor What did you enjoy at Ray & Berndtson?

Bass I have always been fascinated by leadership and I found this a great way to be exposed to many really impressive people at a young age. Though the work wasn’t very similar to what I do now, the experience has actually been a huge help for me as an investor, in terms of assessing the strength of management teams, reading people and bringing people together to close transactions. I also made many good contacts.

Investor What do you enjoy about financing the smallest E&P companies?

Bass The U.S. E&P sector is very entrepreneurial. It’s a highly fragmented industry where hundreds of niche players operate, each having developed some competitive advantage, such as a specific expertise or unique land position. Financing these companies is a lot of fun because most of them have potential to create a lot of value by focusing on these advantages.

This is a wonderful time for U.S. E&P companies under $1 billion, who stayed focused on the U.S. over the years while many larger companies moved on. Now these smaller companies are being rewarded because higher commodity prices, and new technologies are creating new plays in almost every basin.

Investor How did you get into the business?

Bass In my previous career, I came to know Scott Johnson and then, later, Frank Weisser. When I decided that I wanted to make a career change, their firm (Weisser, Johnson & Co.) was attractive to me because of their deep background in investment banking and their reputation. I worked as an investment banker for six years before we raised the fund, GasRock Capital. We had wanted to manage a pool of capital for some time, and we jumped at the chance when a number of the mezzanine funds left the space a few years ago.

Investor What did you learn from your own entrepreneurial experience?

Bass I really respect those people who can turn a company around or start one from scratch.

Investor What do younger people miss about the oil and gas business?

Bass Most people miss how dynamic and entrepreneurial it is. I think our industry has a poor public image, and I was surprised when I first became aware of how much opportunity there is. This industry is 150 years old, but has opportunities for wealth creation that you typically only find in very young industries, like high-tech.

Investor What’s it like trying to maneuver through this business without playing golf or tennis?

Bass It’s a mistake! Which is why I am picking up tennis again after a 15-year hiatus! In all seriousness, though, I have found that people respect you if you have good ideas and bring something to the table. That’s what I like about this industry—it’s very open to good ideas and hard work. Each of us will succeed or fail based on the value we bring to the table. That said, relationships mean a lot, and activities like sports or charity work can really help people get to know you at a deeper level.

Investor What attracts you to sailing?

Bass Everyone is attracted to sailing at first because it looks graceful, beautiful and pleasant. The trouble is, it’s usually not. It’s actually unpredictable, sometimes uncomfortable and occasionally calamitous. What I find engaging is being with a team of people to achieve a common goal in challenging situations with imperfect data. This could be racing, sailing from one island to another, or exploring a coast. The whole experience of sailing brings you closer to the environment. You end up in places you cannot get to by car, plane or cruise ship.

Investor Your children show any interest in following you in the business?

Bass No. They want to be ballerinas at this stage of their lives. I will certainly encourage them to look at our industry. I love energy finance, but there are so many ways to participate in the industry.