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Falfurrias Growth Partners Raises $400MM for Inaugural Growth Buyout Fund

December 11, 2023, 07:14 AM
Filed Under: Private Equity News

Falfurrias Management Partners closed its latest, oversubscribed lower middle-market private equity fund, Falfurrias Growth Partners I (FGP), at $400 million in investor commitments. FGP is the firm's first dedicated growth buyout fund. In addition to FGP, FMP manages its larger $850 million fund, Falfurrias Capital Partners V, and has raised over $2.2 billion of capital since inception.  FGP was oversubscribed and closed at its hard cap due to strong support from both new and existing investors comprising leading global pension plans, asset managers, insurance companies, endowments, foundations, family offices, and high net worth individuals.  Demonstrating alignment with its investors, the General Partner of the fund committed approximately $45 million in capital alongside FGP limited partners.

FGP invests in growth-oriented, lower middle-market businesses in the software and business services sectors.  Within these sectors, the fund targets specific areas that include fintech, technology services, info services, marketing services, data & analytics, and vertical software, among others.  Investments will range between $20 million and $50 million. FGP will employ the same theme-based, Industry First investment strategy that FMP has used in the past, allowing it to identify and partner with differentiated businesses in durable growth markets.  FGP will also open the aperture for the structure of deals FMP pursues including both minority and control investments.

Falfurrias Growth Partners is a new, oversubscribed $400 million fund aimed at lower middle-market investments.

FMP has expanded its team to support this new effort.  Cam Dyer and Michael Clifton joined the firm as Partners to leverage their decades of private equity investing experience to help launch FGP.  Mr. Dyer is chairman of FGP's investment committee and brings more than 25 years of experience investing in the technology space, most recently as Partner and Co-Head of Global TMT Investing at The Carlyle Group.  Mr. Clifton brings more than 20 years of experience in technology investing, including a decade at The Carlyle Group and will serve on FGP's investment committee.  In keeping with FMPs strategy of having partners with both financial and operating backgrounds, FMP also added Amy Brandt as a Partner and FGP investment committee member.  Ms. Brandt was most recently an Operating Executive Director with Serent Capital and has held multiple operating roles in the past including President and CEO of First American Docutech.  Rounding out the senior team leading FGP, Hugh McColl IV is a Vice President and previously worked in both financial and operating roles, including with Welsh, Carson, Anderson & Stowe and Parexel.

"We are delighted to have recruited world class investors and operators to join our team to help launch and lead FGP.  The fund will allow us to pursue attractive investment opportunities that are identified through our Industry First process but where we previously did not have the investment expertise or fund strategy to pursue," said Ed McMahan, Managing Partner of FMP.

Mr. Dyer added "Our team is excited to have joined FMP, which has a strong track record of generating attractive returns for its investors through its Industry First approach supported by deep operating resources resident in the firm.  We believe these extensive resources will allow FGP to continue FMP's track record of successfully growing lower middle market companies in our target sectors."

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