L Squared closes third fund at hard cap
Just six years after its founding, L Squared Capital Partners (L Squared) has exceeded USD1 billion in assets under management, with the closing of L Squared Capital Partners III at just over USD500 million.
The Firm’s family office friendly structure has hit a chord with large US-based family offices which have supported the Firm and led to an oversubscribed offering for L Squared Capital Partners III. The effort, completed in the middle of the Covid-19 pandemic, was largely driven by the Firm’s existing investors; however, L Squared was pleased to add several new high-quality limited partners to its investor base.
With its first two funds, L Squared completed 10 platform investments and has closed 26 add-on transactions. All of these investments have been made within the Firm’s sectors of focus including education technology, tech-enabled services & software, and industrial technology & services. The Firm has successfully completed three exits thus far, all Fund I platform investments. L Squared intends to add seven to nine new platform investments within Fund III while continuing to manage businesses from its first two funds from its Newport Beach, CA and Chicago, IL offices.
L Squared did not retain a placement agent to assist with raising Fund III. Strong support from existing investors allowed for an efficient fundraising process. L Squared is pleased to welcome several new family office investors in Fund III as well as a select group of leading institutional investors that value L Squared’s unique structure and long-term focus. Family office investors have been the focus of the Firm since inception and continue to make up the vast majority of Fund III’s capital base.
Managing Partner Jeff Farrero, says: “We are incredibly appreciative of the tremendous support provided to us by our existing investors during this time of uncertainty. This allowed us to complete the fundraising quickly so that we can keep our focus on quality investing.” Rob Healy, the firm’s Co-Founder and Managing Partner, offered, “It is a great credit to our management teams whose excellent work has allowed us to experience a quick and successful fundraising process. We all look forward to the challenge of building additional outstanding businesses in Fund III.”
Along with Messrs. Healy and Farrero, the firm is managed by Sean Barrette, Randall Hunt and Adam Kimura, all of whom worked together at Chicago Growth Partners prior to founding L Squared in July 2014.