LPs question timing of Coller Capital CEO departure

Several limited partners question why Coller Capital’s Chief Executive Officer Tim Jones is leaving his position so shortly after the firm announced the closing of its seventh fund at $7.15 billion in early January.

The secondary buyer said it didn’t learn until last month of Jones’s decision. However, some LPs and other market sources still wonder whether the firm knew of Jones’s impending departure during the fundraising and withheld the information until after fundraising was complete.

LPs commit to a fund in large measure based on track record, and on the team that will invest the fund, and Jones was considered an integral part of the investment team, sources said. In fact, an LP’s view of a fund’s attractiveness can change if an important member of the team leaves after fundraising ends.

In Coller Capital’s case, LPs have no recourse to demand concessions from the GP, or rescind their commitment, based on the key-man provision in the fund documents. Despite being CEO, Jones was not named a key man. Only firm founder Jeremy Coller is.

In a letter to LPs last week Coller Capital said that Jones was stepping down for “compelling personal reasons” without disclosing specifics. Jones will continue with the firm as a special advisor. Partner Ashley Johansen, who worked on raising Fund VII, is also leaving the company, according to the letter.

Two sources said they considered the departures of both Jones and Johansen significant because the two worked closely together. A person close to Coller Capital said the two departures are not connected.

Coller Capital is conducting a review of how it manages its business to remain flexible and responsive going forward, according to the firm.

“Tim’s decision to step down as CEO is disappointing both for the company and for me personally,” Jeremy Coller said in a statement.

Action Item: Reach Jeremy Coller at JeremyColler@collercapital.com.

Photo courtesy of Coller Capital