Parthenon, on deal tear, comes to market with sixth flagship fund

Parthenon Capital, a prolific healthcare and fintech investor, is back in market with its sixth flagship fund, targeting $1.5 billion, two LPs told Buyouts. 

The fund, if it hits target, would be larger than Parthenon’s prior fund, which closed on its hard cap of $1 billion in 2016. Parthenon Investors V beat its initial target of $850 million. 

Parthenon, with offices in Boston and San Francisco, was formed in 1998 by Ernest Jacquet, a former partner with Summit Partners, and John Rutherford, an ex-Bain & Co. consultant who founded strategic consultancy Parthenon Group. 

The firm, which raised $350 million for its debut fund, invests in financial, healthcare and business and technology services. Its second fund closed on $750 million in 2001. Fund III closed on $700 million in 2007, and the fourth fund closed on $700 million in 2012.

Fund IV is a barnburner, generating a 3.41x net multiple and 37.9 percent net internal rate of return as of Mar. 31, 2019, according to performance information from the Oregon Public Employees Retirement Fund. Fund III is not as strong, generating a 1.84x multiple and 9.2 percent IRR, Oregon said.

Fund II was producing a 1.66x multiple and 12.3 percent IRR, according to Oregon’s numbers. The debut fund had a 1.45x multiple and a 6.5 percent IRR, Oregon said.

Parthenon’s principal owners are David Ament and Brian Golson, according to the firm’s Form ADV. The firm is led by Managing Partners Ament, Golson and Andrew Dodson.  

As of Dec. 31, 2018, Parthenon managed about $3.4 billion, the Form ADV said. 

Parthenon has been busy on the deal front lately. The firm earlier this month completed an investment alongside LLR Partners in DaySmart Software, which provides services to the salon, pet care, spa and tattoo industries. It also recently invested in payment organization Payroc, Buyouts previously reported. 

In June it completed the acquisition along with Waterfall Asset Management of Mid Atlantic Capital Group, according to a press release.

The firm in July merged two portfolio companies, Zelis Healthcare and RedCard, and brought in Bain Capital as an investor, Buyouts previously reported.

Action Item: Check out Parthenon’s Form ADV here: https://bit.ly/31lCcKP