Fundless Sponsor Sponsor Plots Fund IV

Tuckerman Capital, a private equity firm with a unique strategy of investing only in fundless sponsors, is in the early stages of planning its fourth fund, co-founder Timothy Briglin told Buyouts.

Starting sometime early next year, the Hanover, N.H.-based firm will likely seek $100 million for the fund, Tuckerman Capital IV LP. That’s roughly the same amount the firm raised for its previous fund, which still has around $25 million to invest. The firm does not expect to hire a placement agent, Briglin said.

Tuckerman invests in small firms or teams that want to buy companies but don’t have capital to do so. It’s also a one-stop shop of sorts for these fundless sponsors, as it provides both the debt and equity for investments. Tuckerman Capital typically backs deals with enterprise values ranging between $8 million and $30 million.

Briglin said the strategy gives Tuckerman some downside protection if a company struggles, plus current returns by way of debt payments from the target company.

“All the capital is from Tuckerman,” Briglin said. “That’s very unique in the private equity world.”

Hanover Partners Inc., a fundless sponsor that Tuckerman backs, for example, recently sold Solidscape Inc., a manufacturer of three-dimensional printers, to Stratasys, a publicly traded company that specializes in developing and marketing 3-D printing systems. Merrimack, N.H.-based Hanover generated a 2.5x cash-on-cash return on the deal over a five-year investment period, according to the firm.

Briglin and Peter Milliken, both former partners with the buyout firm Green Mountain Partners, founded the firm in 2001. Both have interesting backgrounds: Briglin has experience in investment banking and politics, working for a time as a legislative assistant to Sen. Patrick Leahy of Vermont on economic, tax and banking issues. Milliken, before joining Green Mountain, was an investment manager for Asian Strategic Investments Corp., a China-based private equity fund.