TPG Growth-spinout Knox Lane raises nearly half of Fund I’s $500m target

In a brutal fundraising market for emerging managers, a recently launched San Francisco private equity firm secured a sizable portion of the target set for its inaugural pool.

Knox Lane, led by TPG Growth alumni, collected about $245 million for KLC Fund I, according to an ADV filing. That puts the vehicle almost halfway toward its $500 million goal less than four months after initial Form D fundraising documents were published.

A source previously told Buyouts that Knox Lane raised commitments from several limited partners close to the March filing of the Form Ds. The amount was not disclosed.

Knox Lane, which specializes in making control investments in mid-market consumer and services businesses, was founded late last year by managing partner John Bailey and Partner Shamik Patel. Both are veterans of TPG Growth, the growth equity and mid-market buyout arm of TPG.

Bailey, who was with the firm for eight years, led consumer sector investing. He left that role in 2015, his LinkedIn profile shows, to become CEO of elf Cosmetics, a makeup and beauty products brand acquired by TPG Growth a year earlier.

Patel, who was with TPG Growth for seven years, led services-focused investing. He departed in 2019, his LinkedIn profile shows.

Most other Knox Lane team members also have a TPG Growth history, including principals David Coghlan and Brent Gunderson. The firm this year added yet another alumnus: Hillary Pond, formerly an associate with TPG Growth, was recruited as a vice president.

The health crisis added to fundraising challenges faced by general partners with first- and second-time offerings, Buyouts reported in May. Teams spun out of large, brand-name PE firms may be better positioned than other emerging managers, however, as they often reflect seasoned GPs with a clear track record and existing LP relationships.

Knox Lane declined to comment on this story.

Action item: Check out Knox Lane’s ADV filings here.