Skin in the game

Reports of GP commitment pressure


Happy Monday. Here’s what we’ve got today…

  • A look at trends in LP fundraising demands

  • The deal sheet, plus the fight to save Gucci


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New fund launches face pressure to commit more personal capital

By Bob Clair

With a fundraising environment that remains challenged, alongside a continued dearth of exits, some limited partners (LPs) may be putting greater pressure on general partners (GPs) to invest more of their personal wealth into their fund—their GP commitment.

Though reports of GP commitment pressure from LPs are on the rise, senior investment professionals who spoke with Transacted say that this phenomenon is not yet widespread and appears centered on newer funds rather than those with tenured relationships.

“We haven’t seen that pressure,” said Alex Levental, a partner at Ironwood Capital. “It’s kind of investor-specific. Some want to see more investment and may not invest in the fund for that reason, but I don’t think it’s common.”

A partner at L2 Capital agreed with Levental, and both investors noted that they are seeing more pressure on fees than a push for personal commitment. However, Levental said, things are likely different for recent launches.

“We often work with the same investors, so having an established relationship probably keeps them from demanding more investment,” Levental said. “We’re on our fifth fund, and our LPs have continued to grow with us. For first-time fund managers, LPs will likely want them to have more skin in the game because they don’t have a track record.”

Martin Stein, managing director at Blackford Capital, also said his firm has not faced that pressure, but noted its last fund was raised in 2020 and likely will face it in the future.

“We will be,” he said when asked if he expects his firm to increase its commitments in response to LP pressure.

Levental said executives at his firm typically invest 2 percent of total equity per fund, which he described as an industry standard. He added that some larger firms invest more.

“Some of the larger funds have a GP sidecar that they put their capital in.”

Increased commitments can also pose more of a challenge for GPs who are exposed to the same sluggish fund distributions as their LPs. With more personal assets tied up in older funds, finding spare capacity may not be straightforward.

GPs are increasingly turning to debt financing options to meet their funding requirements. Traditional banks and wealth management firms can provide such solutions, as can a number of private credit firms that have recently launched offerings in the space, including Oaktree Capital Management, Ares Management, and 17Capital.

“The question from LPs is how much personal investment do you have,” said William Barret, managing partner at placement advisory firm Reach Capital. “But private equity executives need to be aware that the loans are often not cheap.”

It remains to be seen whether GPs more broadly are ultimately forced to put more skin in the game, but until outlook and sentiment stabilize, continued pressure may be likely, the L2 Capital partner said.

“Until things calm down, that is certainly possible.”


Thoma Bravo agreed to acquire Darktrace, a UK-based cybersecurity company, for $5.3 billion in cash.

Carlyle Group is considering exit options for Tamko Building Products, a maker of roof shingles, that could value the company at more than $3.5 billion, per Bloomberg.

General Mills (NYSE: GIS) is exploring a potential sale of its North America yogurt business, including the Yoplait brand, in a deal that could be worth more than $2 billion, with JPMorgan hired to advise, per Reuters.

Ono Pharmaceutical has agreed to acquire Deciphera Pharmaceuticals (Nasdaq: DCPH), a commercial-stage biotech focused on novel small molecule kinase inhibitor cancer therapeutics, for $2.4 billion.

UMB Financial Corporation (Nasdaq: UMBF) agreed to acquire Heartland Financial USA, Inc. (Nasdaq: HTLF) in an all-stock transaction valued at around $2 billion, per Bloomberg.

Amber EquityCo, a consortium formed by I Squared and TDR Capital, is in pole position to acquire Applus+, a Spanish industrial inspection and certification company, after submitting a $1.77 billion proposal to top a previous Apollo offer.

Apollo Global Management, KKR, and Stonepeak are considering an investment of billions of dollars through a joint venture to fund Intel Corporation's (Nasdaq: INTC) semiconductor fabrication facility in Ireland.

Pine Gate Renewables, a developer of large solar and energy storage projects, raised $650 million in new funding from Generate Capital, Healthcare of Ontario Pension Plan, and HESTA.

FountainVest Partners and Unison Capital are nearing a deal to acquire Tasaki & Co., a Japanese jeweler operating over 100 stores across Asia and Europe, from MBK Partners for more than $600 million.

Carlyle Group is in discussions to acquire Mitsubishi Corp.'s 35 percent stake in KFC Holdings Japan, the operator of domestic Kentucky Fried Chicken locations, as part of a planned take-private.

Bruin Capital agreed to acquire a majority stake in PlayGreen BV, a Dutch holding company for natural grass playing fields businesses Stadium Grow Lighting and ALVA Technology, at a valuation of more than $100 million.

Manipal Hospitals, a Bengaluru-based healthcare provider backed by Singapore's Temasek Holdings, agreed to acquire an 87 percent stake in Medica Synergie, a Kolkata-based hospital chain, for around $168 million.

Investcorp has agreed to acquire NSEIT, the digital technology services business of India's National Stock Exchange, for $120 million.

Lawrence Stroll, owner of the Aston Martin F1 team, is in early talks to sell up to a 25 percent minority stake in the team, which follows a previous minority investment from Arctos Partners last year at a £1 billion valuation.


TotalEnergies, the French energy and petroleum producer, is considering a New York primary listing, per Reuters.

Super Hi International, a Hong Kong-based hot pot chain and packaged condiments producer, filed for a Nasdaq listing.


Tech, Vertical SaaS, & Misc. Enterprise

Yoneda Labs, a startup developing chemistry-focused foundation models, raised $4 million in seed funding from Khosla Ventures, 500 Emerging Europe, 468 Capital, Fellows Fund, and Y Combinator.


WEE Marketplace, a Dubai-based on-demand delivery and e-commerce platform, raised $10 million in debt and equity funding from SIG Investment.

Edia, a provider of AI-powered learning and coaching tools, raised $9.4 million in funding led by Felicis.


Amae Health, an outpatient mental health clinic, raised $15 million in Series A funding led by Quiet Capital, with participation from Healthier Capital, Baszucki Group, and Mike Volpi of Index Ventures.


General Catalyst is closing in on a $6 billion raise for its latest tech-focused venture funds.

Duration Capital Partners, a transportation-focused Oaktree-spinout, is launching with $3.7 billion under management.

Tor Investment Management raised $370 million for its third Asia-focused credit opportunities fund.


1. Billionaire Pinaults Fight to Pull Gucci Off the Discount Rack.

• Some investors and analysts are questioning whether CEO François-Henri Pinault is the right man to overhaul Gucci’s parent Kering at this critical juncture. — Bloomberg

2. When Fear Is a Friend: US Multifamily in Focus.

• “As owners come under more pressure to sell assets, we see an exciting opportunity coming to buy high-quality properties below replacement cost while achieving attractive long-term yields.” — KKR Real Estate


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