Goldman spinout New Mainstream collects $275 mln for Fund III

New Mainstream Capital collected $275 million for a second close on its third fund, which is targeting $350 million, a source said.

New Mainstream launched Fund III last year. The firm, which spun out of Goldman Sachs’s merchant banking division, invests in lower-middle-market healthcare and business services.

Stanwich Advisors is placement agent on the fundraising.

No one at New Mainstream returned a request for comment.

The firm closed Fund II on $252 million in 2015 and an undisclosed amount for its debut. Fund II was generating a 9 percent internal rate of return and 1.1x multiple as of June 30, an investor presentation Buyouts previously reported on showed.

New Mainstream was formed in December 2010 by former Goldman Managing Directors Martin Chavez and Kevin Jordan. They were joined by Robert Haas, co-founder and chairman of Haas Wheat & Partners, who is chairman of the strategic advisory committee.

Other partners are James Wilson, who has been with New Mainstream since 2010, and Luis Gonzalez, who joined in 2016.

A former partner, Wyche Walton who had been with New Mainstream since inception, left in 2016, according to his LinkedIn profile.

As part of its founding, New Mainstream acquired a majority of Goldman Sachs Urban Investment Group’s corporate portfolio. Pantheon also is an investor in New Mainstream, Buyouts reported.

New Mainstream has been building up its Anne Arundel Dermatology Management platform. The company acquired three dermatology practices this year: Dermatology Associates of Knoxville PC; East Tennessee Dermatology Group PC; and Tideway Dermatology, a practice in Maryland.

Action Item: Check out New Mainstream’s Form ADV here: https://bit.ly/2I7qTQN

Hands with money and plant. Photo courtesy of AlexSava/iStock/Getty Images