Kevin Dowd December 20, 2016
The time for wrapping up year-end business is upon us. For one major private equity firm, that means closing one of 2016’s biggest buyout funds. For two others, it means plans to raise future billions.
We’ll start in London, where Apax Partners has closed its ninth flagship fund on the fitting figure of $9 billion after less than a year of seeking commitments. The vehicle is the fourth-largest closed by a private equity firm so far this year, according to the PitchBook Platform, and is the biggest fund raised in 2016 by an investor based in Europe, surpassing the Sixth Cinven Fund, which closed on €7 billion earlier this year.
It also marks a significant (if measured) increase from the previous fund in the series, Apax VIII, which closed on $7.5 billion just three-and-a-half years ago. Apax will use the new vehicle to continue its current strategy of investing primarily in the tech, telecommunications, services, healthcare and consumer industries.
It’s safe to say Apax’s aim is to net hefty returns. The same could be said for TPG Growth’s upcoming fund—but the San Francisco-based investor’s new vehicle will also be held to a higher standard.
The growth-focused arm of TPG unveiled on Tuesday plans to raise $2 billion for Rise, a new social impact fund that will invest in industries such as healthcare, education clean energy, fintech and housing. TPG partner William McGlashan will run the fund, according to The New York Times; the fund also boasts a star-studded board of directors that includes Bono, Reid Hoffman, Richard Branson, Laurene Powell Jobs, Mo Ibrahim and Pierre Omidyar.
McGlashan has worked with a consulting firm to develop a set of metrics to measure the social efficacy of the fund’s investments, per the NYT. Pay for TPG’s employees, though, will still be based on financial performance.
It’s the second major fundraising development for TPG so far in 2016, coming seven months after the firm’s close of its seventh flagship buyout fund on $10.5 billion.
Veritas Capital won’t reach that lofty sum with its sixth buyout fund, but the $3 billion target the New York-based firm has set in an SEC filing is worth noting for a couple reasons. First, the launch of the new fund comes just 18 months after the firm closed its most recent vehicle, Veritas Capital Fund V. And second, if it reaches that $3 billion target, the new fund would represent a nearly 60% size increase over its predecessor, which raised $1.88 billion for a June 2015 close.