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TPG raises more than $900 mln to buy equity from employees, founders in tech companies

  • Debut fund has raised $924 mln
  • Target is $1.5 bln
  • Unusual strategy for a private equity firm

TPG has raised more than $900 million for its debut fund that will buy private shares in tech firms whose employees are looking to get paid, according to a person with knowledge of the process and an SEC filing.

The filing said TPG raised $924 million from 53 investors. The fund is still in fundraising mode. TPG Tech Adjacencies fund is targeting $1.5 billion, according to an LP source who has seen the fund pitch. Bloomberg initially reported on the fund earlier this year.

Luke Barrett, a spokesman with TPG, declined to comment.

Tech Adjacencies will seek to buy private shares from employees, founders and investors in tech companies. The strategy became popular in past years as employees at big tech firms sought liquidity for their shares prior the companies going public.  

The fund also will target other types of equity transactions, though details of the fund’s strategy were not available. The strategy will be managed by TPG’s tech team, the person said. 

Another firm providing liquidity to tech employees whose equity is locked up is Troy Capital Group, which closed a $200 million fund to provide loans to such employees. Troy is backed by Oaktree Capital Group. Troy was formed by Josh Berman, co-founder of MySpace, Samit Varma, former partner at Anthem Ventures and Brian Sullivan, co-founder of ForwardLine.

“As former operators of private technology companies, we understand the large and growing demand for early access to loans or liquidity, particularly as large, private technology companies stay private longer than ever,” Varma said in a statement.

Action Item: Read TPG’s Form ADV here: https://bit.ly/2AodJrS