L Squared has held the final closing of its fourth private equity fund with $840 million of capital. The firm’s earlier fund closed in September 2020 with $505 million of capital.
L Squared invests from $50 million to $125 million of equity in North America-based companies that have revenues of $20 million to $125 million and EBITDA of $5 million to $30 million. Sectors of interest include tech-enabled services and software, education technology, and industrial technology and services.
“The strong growth in our business in a somewhat more challenging economic environment is a great testament to the hard-working management teams that run our businesses. We could not do what we do without their tremendous dedication to excellence,” said Rob Healy, a co-founder and managing partner at L Squared. “All of us at L Squared owe them a debt of gratitude. We are also humbled and honored by the incredible support that we received from our investors. We plan on working very hard to ensure their capital is invested wisely in growth businesses within our areas of expertise.”
Fund IV’s limited partners include both existing investors and several new institutional investors and family offices.
L Squared completed investing its third fund with the June 2023 acquisition of ERA Industries, an Illinois-based contract manufacturer specializing in precision machining and assemblies that are used in the aerospace, military, medical, semiconductor, and transportation industries.
Since its founding in 2014, L Squared has closed 17 platform investments and will soon close its 50th add-on transaction with a combined $3 billion of enterprise value. The majority of L Squared’s acquisitions have been founder-led companies undergoing their first institutional transaction. The firm has completed several exits across Funds I and II and currently manages ten platform investments across its three predecessor funds.
Newport Beach, California-based L Squared is led by Mr. Healy, Jeff Farrero, Sean Barrette, Randall Hunt and Adam Kimura, all of whom worked together at Chicago Growth Partners prior to founding L Squared.
Eaton Partners, a Stifel Company, was the placement agent for Fund IV and Vedder Price provided legal services.
© 2023 Private Equity Professional | November 17, 2023
