RCP Fund XVIII Closes on ~$285 Million in Aggregate Capital Commitments

Rhea-AI Summary

RCP Advisors, a private equity firm, has announced the closing of RCP Fund XVIII with $285 million in aggregate capital commitments. Fund XVIII, supported by a broad base of new and existing investors, targets small buyout fund managers. The Fund aims to invest in small to mid-sized companies with $3 million to $25 million in EBITDA. It will continue RCP's strategy of leveraging research and analytics to achieve top-quartile performance. Investors include family offices, high-net-worth individuals, foundations, public pension plans, and endowments.

Positive

• RCP Fund XVIII successfully raised $285 million in aggregate commitments.
• The Fund has a diverse investor base, including family offices, high-net-worth individuals, foundations, public pension plans, and endowments.
• The Fund aims to invest in small to mid-sized companies with $3 million to $25 million in EBITDA, a market with compelling investment opportunities.
• RCP Advisors will continue to use their industry-leading research, data, and analytics to target top-quartile performance.

Negative

• The Fund's strategy is to buyout fund managers with under $1 billion in committed capital, potentially restricting growth opportunities.
• Target investments are in small to mid-sized companies, which may have higher associated risks compared to larger, more established firms.

Insights

Financial Analyst

The final closing of RCP Fund XVIII with $285 million in aggregate commitments is noteworthy, especially in today's competitive private equity landscape. This signals strong investor confidence in RCP Advisors' strategy focusing on small buyouts. From a financial standpoint, the fund's emphasis on small to mid-sized companies with $3 million to $25 million in EBITDA highlights a niche market that often provides higher returns due to limited competition and potential for operational improvements. However, it's essential to consider the broader economic environment and its potential impact on these smaller companies, particularly during economic downturns.

Market Research Analyst

RCP Advisors' strategy of targeting small to mid-sized companies can be highly lucrative, as these enterprises often have untapped potential and room for growth. By focusing on fund managers with less than $1 billion in committed capital, RCP is positioning itself to benefit from the agility and specialized expertise of smaller buyout firms. However, retail investors should note that private equity investments typically have longer investment horizons and lower liquidity compared to public markets. Additionally, success in this sector heavily relies on the ability to select and manage high-quality investments, making the choice of fund manager critical.

CHICAGO, May 13, 2024 (GLOBE NEWSWIRE) -- RCP Advisors, a private equity investment firm that provides access to North American small buyout fund managers through primary funds, secondary funds, and co-investment funds, announced the final closing of RCP Fund XVIII (“Fund XVIII” or the “Fund”). The Fund closed on approximately $285 million in aggregate commitments. The Fund has a broad LP base of new and existing investors, including family offices, high-net-worth individuals, foundations, public pension plans, and endowments.

“We want to express our sincere gratitude to our limited partners for their continued faith and confidence in our team and strategy. Small company buyouts continue to provide compelling investment opportunities that we believe are differentiated from and superior to other sectors within the private equity market. We will continue to leverage our industry-leading research, data, and analytics in seeking to realize our goal of generating top-quartile performance for our investors,” said Tom Danis, Managing Partner at RCP Advisors.

Fund XVIII will adhere to the same investment strategy that RCP’s predecessor primary funds employ. The Fund will generally target investments with buyout fund managers primarily focusing on less than $1 billion in committed capital. These managers will, in turn, generally seek to make control-oriented investments in established, small to mid-sized companies with approximately $3 million to $25 million in EBITDA.

About RCP Advisors
Founded in 2001, RCP Advisors, a subsidiary of P10, Inc. (NYSE: PX), is a private equity investment firm that provides access to North American small buyout fund managers through primary funds, secondary funds, and co-investment funds, as well as customized solutions and research services. RCP believes it is one of the largest fund sponsors focused on this niche, with ~$14 billion in committed capital* and 57 full-time professionals as of May 8, 2024.

The information contained in this press release does not constitute investment advice or an offer or sale of any security or investment product. Offerings are made only pursuant to a private offering memorandum containing important information. Statements are made as of the date of this release, and there is no implication that the information contained herein is correct as of any time subsequent to such date. Some of the statements in this release may constitute "forward-looking statements" within the meaning of the federal securities laws. Any forward-looking statements inherently are subject to a variety of risks and uncertainties that could cause actual results or events to differ materially from those results or events predicted or anticipated by these statements. RCP’s investment strategy is subject to significant risks and there is no guarantee that any fund will achieve comparable results as any prior investments or prior investment funds of RCP. Past performance does not predict, and is not a guarantee of, future results.

FAQ

What is RCP Fund XVIII?

RCP Fund XVIII is a private equity fund managed by RCP Advisors, focusing on small buyout fund managers and aiming to invest in small to mid-sized companies.

How much capital did RCP Fund XVIII raise?

RCP Fund XVIII raised approximately $285 million in aggregate capital commitments.

Who are the investors in RCP Fund XVIII?

The Fund's investor base includes family offices, high-net-worth individuals, foundations, public pension plans, and endowments.

What is the investment strategy of RCP Fund XVIII?

RCP Fund XVIII will target buyout fund managers with less than $1 billion in committed capital, focusing on control-oriented investments in small to mid-sized companies with $3 million to $25 million in EBITDA.

What is the target company size for RCP Fund XVIII investments?

RCP Fund XVIII targets small to mid-sized companies with approximately $3 million to $25 million in EBITDA.