Brookfield and Sequoia spin-off launch fund to target discount-priced start-ups

Receive totally free Brookfield Asset Management Inc updates

Brookfield Asset Management and Sequoia Heritage, a $16bn fund that handles the wealth of Silicon Valley, are developing a financial investment lorry to capitalise on plunging assessments of endeavor capital-backed business.

The companies are investing $250mn each to discovered a brand-new business called Pinegrove Capital Partners led by Brian Laibow, according to 2 sources acquainted with the matter. Until just recently, Laibow was co-head of the North American operations of Oaktree Capital Management’s flagship distressed fund.

Brookfield and Sequoia Heritage will each own a 50 percent stake in the investment firm, which is likewise attempting to bring in outdoors capital from big institutional financiers. The company intends to raise more than $2bn for its very first fund, which will buy independently held business that have actually seen their assessments topple amidst a repricing of venture-backed groups.

Brookfield and Sequoia Heritage decreased to comment.

The brand-new lorry will benefit from a financing crunch for start-ups and their equity capital owners, who have actually struggled to leave their financial investments amidst a significant downturn in going publics. Investors in equity capital funds have, on the other hand, discovered it more difficult to redeem their cash.

Pinegrove will purchase up stakes in start-ups from endeavor backers who are under pressure to provide go back to their own financiers, in addition to shares in endeavor funds from individuals aiming to squander. It will likewise use some kinds of financing.

Startups in hard-hit sectors such as cryptocurrencies and fintech are trading at discount rates of as much as 80 percent, according to individuals in the secondary market.

Sequoia Heritage was established in 2010 with cash from senior partners at equity capital company Sequoia Capital, consisting of $150mn each from Doug Leone and Michael Moritz. The company has actually because grown considerably, and protected financial investments from Stripe co-founder John Collison and previous Google manager Eric Schmidt’s household structure.

Sequoia Heritage invests individually from Sequoia Capital. Last month, Moritz stepped down from his function at Sequoia Capital to concentrate on his Heritage financial investments full-time.

Sequoia Heritage and Brookfield have actually ended up being better over the last few years. In January 2022, they went into a “strategic partnership” to develop logistics support for Sequoia China’s financial investments in regional ecommerce start-ups. Brookfield likewise bought Sequoia China, which remains in the procedure of being spun off from the United States company.

Bruce Flatt, president of Brookfield, and magnates at Sequoia were presented by Bruce Karsh, the cofounder of Oaktree. He made the intro quickly after Brookfield got a controlling interest in Oaktree in 2019.


News and digital media editor, writer, and communications specialist. Passionate about social justice, equity, and wellness. Covering the news, viewing it differently.

Related Articles

Back to top button