Funds of Funds Fundraising in Q1 2014 - April 2014

Date: Tuesday, April 15, 2014
Author: Preqin

During Q1 2014, Preqin recorded 19 fund of funds vehicles holding a final close and raising an aggregate $3.6bn. The total capital raised has dropped slightly in comparison to the fundraising data from Q1 2013, whereby 18 funds of funds secured $5.5bn in total investor commitments. Of the 19 vehicles to hold a final close in Q1 2014, the majority (68%) were raised by US-based firms, with the remaining funds raised by fund of funds managers headquartered in the UK (16%), Switzerland (11%) and Denmark (5%).

ATP Private Equity Partners V was the largest fund of funds vehicle to hold a final close in Q1 2014, having raised a total of €800 million ($1.1bn) from investors. The fifth offering from Denmark-based ATP Private Equity Partners focuses on investing in buyout, venture capital, distressed debt and secondaries vehicles. It seeks exposure to North America and Europe, with some interest in emerging markets. ATP Private Equity Partners V plans to make around 20 fund commitments over the course of its life, and will access these opportunities through the secondary market and through co-investing, as well as by making primary investments into funds.

The second largest vehicle by the total capital raised is Pathway Private Equity Fund XXV, which secured $700 million in capital commitments. The vehicle, raised by US-based Pathway Capital Management, takes an opportunistic approach towards all potential fund commitments and regions, although it has previously demonstrated a particular interest in North America-focused vehicles. Pathway Private Equity Fund XXV will consider purchasing fund interests on the secondary market as well as making primary commitments.

Pacific Street Fund III held a final close in February having secured $453 million in investor capital, making it the third largest fund of funds vehicle to close in Q1 2014. The fund, which is the third in the series raised by Twin Bridge Capital Partners, focuses on gaining exposure to the US through investments in small and middle-market buyout funds.