Paul Capital To Raise $100M For First Co-Investment Fund

Paul Capital Partners, a San Francisco funds-of-funds manager founded in 1991, next year plans to launch a $100 million mid-market co-investment vehicle that targets both buyout and growth equity opportunities, according to a source close to the company.

The new fund will be managed from Paul Capital’s offices in New York by two investing professionals who joined the company earlier this year: Managing Director Dana O’Brien, who spent 22 years at Cornerstone Equity Investors and its predecessor, Prudential Equity Investors, and Dan Townsend, a Paul Capital principal who spent nine years at GE Asset Management as a vice president in its International Private Equity Group.

O’Brien and Townsend did not respond to requests for comment.

The move comes amid a very busy time for Paul Capital, which raised 10 funds between 1991 and 2006 but kicked into overdrive earlier this year. According to SEC filings, it is already in the market with two funds. The first, targeting $650 million, is Paul’s third fund dedicated to acquiring health care royalty interests. The firm also is marketing a $200 million global secondary fund, another of Paul Capital’s specialties.

Finally, with commitments from limited partners such as the Ohio Public Employees’ Retirement System, Generali Global Private Equity, and BP Trustees Pension Ltd., Paul Capital this fall closed a $218 million fund to back U.S. venture capital funds, mostly through primary fund commitments. Among the venture firms that Paul Capital has backed is Shasta Ventures of Menlo Park, Calif., which closed a second, $250 million, fund last month.—C.L.