Firm: Prophet Equity
Fund: Prophet Equity LP
Target: $250 million
Amount Raised: $215 million
As of early August, the firm’s namesake fund,
Prophet Equity uses a system of “rolling closes,” meaning that when LPs are ready, they invest and close, as opposed the more traditional method of holding a close after a number of investors have signed on. The latest $15 million slug that the fund closed on came from an international fund-of-funds manager that had raised a special situations fund in 2007 and had a few slots remaining, said our source. It decided to allocate one of those spots to an emerging manager and ultimately chose Prophet Equity.
With the new fund, Prophet Equity intends to make two to three equity investments per year of $5 million to $50 million in companies with enterprise values ranging from $10 million to $250 million. The firm will consider a broad spectrum of deal types, including corporate carve-outs, stalking-horse bids, turnarounds and control acquisitions. Sectors of interest include automotive and transportation, consumer products, defense and aerospace, health care, financial services, and manufacturing.
Backers include Danish fund of funds
Prophet Equity was founded in December 2007 by CEO and Managing Partner Ross Gatlin and COO George Stelling. The pair chose to name the firm in honor of their ability to spot future value, and also as a playful pun on the word “profit.” Before Prophet Equity, Gatlin helped found Dallas turnaround shop
Staying true to its name, Prophet Equity already is already planning its second fund before it wraps up its first. The follow-on vehicle,