Patient Square eyes $4bn goal for what could be largest-ever first-time fund

Slowdown be damned!

Patient Square, the first-time firm led by ex-KKR healthcare specialist Jim Momtazee, is racing toward what could be the largest-ever first-time private equity fund, two sources told Buyouts.

The fund, Patient Square Equity Partners, has collected about $3 billion, which the pool had been targeting since launching last year. Now, the firm wants to raise up to $4 billion before finishing up fundraising, the two sources said.

Patient Square is among a handful of first-time fundraisers in a market that has increasingly turned against them, as LPs run out of allocation space for the year. The frenetic pace of fundraising, especially the flood of re-ups and new products from established managers, left little room for newcomers.

Some firms, however, led by partners already well-known among LPs, with provable track records, are having an easier time bringing in LP capital.

Momtazee assembled a strong team of healthcare specialists, including Alex Albert, who was formerly co-head of private equity healthcare investments at Ares Management; Neel Varshney, who joined from KKR, where he was a managing director on KKR’s Americas healthcare team; and Karr Narula, who formerly worked at KKR as head of the portfolio operations team in the Americas.

PJT Park Hill is working as placement agent on the fundraising. Patient Square has already deployed about $1 billion, one of the sources said. The firm has five portfolio companies listed on the website: Apollo Therapeutics; Enavate Sciences; Summit BHC; Kriya Therapeutics; and SOC Telemed.

Enavate was the firm’s most recent investment. In May, Patient Square committed $300 million to the company that invests in life sciences and biotech businesses.

Patient Square pursues investments across healthcare products, services and technologies in sub-sectors like biopharmaceuticals, pharmaceutical value chain, medical devices, healthcare providers and tech-enabled services, according to its website.

Momtazee also launched a special purpose acquisition company, sponsoring Montes Archimedes Acquisition Corp, which raised $400 million in an IPO in 2020.

Another first-timer getting ready to hit the market is Riverspan Partners, led by executives from Golden Gate and BDT & Co. Riverspan’s debut fund is expected to target $650 million, Buyouts previously reported.

Last year, some 553 first-time funds collected more than $46 billion globally, Preqin reports. That was down from the $52.8 billion raised by 572 funds globally in 2020. The peak was in 2017, when 924 funds globally raised $196.7 billion, according to Preqin’s information.