Mid-Market Funds Are Lowering Their Targets, Too

Latest Example: Riverwood Capital, which last October began raising its debut fund with a $1.25 billion target. Pretty ambitious for a first-timer in today’s market.

Or maybe a bit too ambitious. The Palo Alto-based firm, which makes growth equity tech investments, is now telling prospective LPs that $750 million is probably a more realistic fund size, according to a source.

Notably, Riverwood Capital wasn’t always Riverwood. The firm formed last year under the name “Bigwood Capital,” with co-founders Michael Marks, the former KKR partner and Flextronics CEO, and Christopher Varelas, the former co-global head of tech media and telecom investment banking for Citigroup. No word on the reason behind the name change.

The firm, alongside FTVentures, invested $13 million in Latin American software development and IT outsourcer Globant in December.

We haven’t heard back from Riverwood yet but will update when we do.

Many of the big guys have lowered their funds (KKR, Blackstone, Madison Dearborn), but now it’s trickling down to the mid-level firms. Earlier this year Thoma Bravo, a well-known 28-year-old buyout firm, lowered the target on its ninth buyout firm by almost half.