Latticework Capital wraps up debut healthcare fund at $120 mln-plus

Latticework Capital Management, an emerging healthcare manager, has completed fundraising for its inaugural vehicle, raising more than $120 million, according to an SEC filing.

LCM Healthcare Fund I secured commitments from family offices, funds-of-funds, pension funds and other investors, according to a statement on the website of BHA, which advised the Dallas-based private equity firm. BHA put the final close total at $125 million.

Latticework did not respond to a request for comment.

Latticework was founded in 2014 by Managing Partners Kyle Bradford and Steve Neumann, both veterans of healthcare PE investing. Bradford was previously a managing director and co-head of the healthcare group at American Capital, where he served for almost 13 years. Neumann worked for 17 years at KRG Capital Partners, mostly recently as a managing director and head of healthcare.

Latticework’s team invested in 16 healthcare companies, representing deployments of more than $1 billion, before launching the firm. This activity was focused on veterinary, behavioral health, hospice, physical therapy, home infusion, diabetic supply distribution, pharmaceutical services, medical equipment manufacturing and other sectors.

Bradford and Neumann set up Latticework to make control investments in lower mid-market businesses across the U.S. healthcare industry. The firm targets platform opportunities with Ebitda of $1 million to $10 million, with a preference for sub-$5 million Ebitda opportunities, positioned for organic growth and acquisitions in niche sectors.

Latticework made five investments prior to closing Fund I. Its first deal, done in 2015, engaged American Veterinary Group, a Tampa, Florida-based acquirer of veterinary clinics, animal hospitals and other pet care facilities. AVG, also backed by Trive Capital, later bought Animal Medical Clinic, Lakeside Animal Hospital and Magnolia Animal Hospital.

In 2016, Latticework recapped Restoration Counseling & Community Services, a Minneapolis-based behavioral health services provider to individuals emerging from the criminal justice system. The firm has since invested in Rural Partners in Medicine, a Broomfield, Colorado-based provider of physician services to rural hospitals; Salt Dental Collective, a Medford, Oregon-based dental service organization; and Xpress Wellness, an Enid, Oklahoma-based operator of urgent care centers.

Bradford and Neumann lead a team of six investment professionals. They include Vice President Will Fletcher, formerly with American Capital, and Vice President Alek Blankenau, formerly with Lone Star Investment Advisors.

Action item: See Latticework Capital’s investment overview here.