Small Buyout Strategies

We are dedicated to identifying, critically assessing, and investing in the leading small market, growth-oriented buyout managers in North America. We believe that the small buyout market offers the most compelling investment opportunity for investors that want exposure to high quality, rapidly growing businesses in partnership with knowledgeable and capable equity sponsorship. Our goal is to build well-diversified, thoughtfully constructed portfolios of 14-16 small market buyout funds with differentiated strategies for value creation; we complement that exposure with  direct co-investments alongside our managers. Investors gain exposure to both established and next generation managers that have proven, consistent track records of sourcing, developing and realizing investments and have generated strong relative and absolute historical returns for investors. We believe that operational and sector expertise in particular can provide more attractive returns relative to generalist buyout funds without differentiated strategies.

Investment Criteria

We invest in the leading control-oriented, cash flow-focused, small market buyout managers in North America.  We target managers that invest in rapidly growing, entrepreneurial businesses whose enterprise values range from $30 to $300 million and whose revenues range from $15 to $150 million. Our preference is to invest in managers who seek control through majority ownership of the underlying companies. We primarily target managers with differentiated strategies focused on growing parts of U.S. GDP and which require specific domain expertise to exploit opportunities in the following industries : business services, manufacturing, consumer, energy, financial services, healthcare, media, technology and information services.

Fund Name Vintage Year Fund Size Fund Status
Five Points Small Buyout Strategies II 2013 $54M Currently Managing
Five Points Small Buyout Strategies I 2007 $101M* Currently Managing

*Fund I totals $144M committed in two separate tranches: $101M in 2007 to warehouse all of Fund I’s portfolio fund investments, and $43M in 2013 to act as a feeder for Fund II. There are no economics or fees associated with the 2013 tranche.

Investment Criteria

Investment Strategy

  • Small market, growth-oriented buyout investments in North America

Geography

  • North America; primarily United States

Types of Transactions

  • Primary limited partnership commitments
  • Secondary limited partnership purchases
  • Direct equity co-investment

Investment Criteria

  • Fund size between $100 million and $1 billion (target below $500 million)
  • Profitable companies with enterprise values between $30 million and $300 million
  • Will consider established teams and next generation managers

Investment Size

  • Fund commitments of $3 million to $10 million
  • Direct equity co-investments of $1 million to $5 million

Strategies Considered

  • Single-sector (Aerospace & Defense, Consumer, Energy, Financial Services, Healthcare, Media & Entertainment and Technology)
  • Operationally-oriented
  • Niche generalist
  • Special situations
  • Growth buyout

Manager Characteristics

  • Strong, verifiable track records of success
  • Experienced and cohesive team
  • Differentiated and proven strategy
  • Unique sourcing capabilities
  • Proven value creation attributes

Will Not Invest In

  • Credit strategies
  • Real estate strategies
  • Venture capital strategies
  • Funds domiciled outside of North America