Brookfield and Sequoia-backed Pinegrove shares strategy details

Pinegrove Capital Partners, a venture secondaries firm backed by Sequoia Heritage and Brookfield Asset Management, has officially started raising its debut fund and shared details about its strategy in new regulatory filings.

The firm filed a Form D this month indicating it kicked off fundraising. The filing does not list a target amount for Pinegrove Capital Partners I, which the Financial Times has reported is seeking $2 billion from institutional investors. Pinegrove states on its website that it is “backed with a $500 million commitment” from Sequoia Heritage, which is Sequoia Capital’s wealth management arm, and Brookfield. It is not clear if that commitment is included in its fundraising target.

Pinegrove has kept a low profile since its launch last August. Founder and chief executive Brian Laibow declined to comment.

A brochure included with the firm’s Form ADV offers the first detailed look at Pinegrove’s strategy. It states that it “provides discretionary management for funds with an overall emphasis on investing in high-quality, late-stage private technology companies. Pinegrove intends to draw upon a large set of liquidity options, including equity investments and structured financings, as well as GP- and LP-facing transactions, to gain exposure to its target companies at attractive risk-adjusted returns.”

The firm plans to focus on deals of “at least $50 million [in] total investment size”, which it believes are “generally less competitive transactions due to the fact that there are fewer competing sources of capital that can pursue investments of such size”.

The brochure goes on to state: “For GPs, liquidity solutions include continuation funds, partial or full acquisition of legacy companies, fund restructurings, NAV loans, secondary share purchases and partnerships to provide new primary capital (particularly for company-led share tenders). For LPs, liquidity solutions include purchase or financings of LP interests, direct co-investments, and unfunded commitments.”

While Pinegrove’s initial strategy will focus on late-stage private tech companies, it said it “may expand into other markets over time” and “may determine to manage other funds with different investment strategies”, the brochure states.

Of note in Pinegrove’s Form D is the roster of heavy hitters listed as “manager[s] of the general partner of the issuer’s general partner”. They include Keith Johnson, founding partner and chief executive of Sequoia Heritage; Kevin Kelly, partner and CIO of Sequoia Heritage; Anuj Ranjan, CEO of Brookfield’s Private Equity Group and Brookfield Business Partners; and Mark Srulowitz, a managing partner at Brookfield and head of legal and product development in Brookfield’s Private Funds Group.

A source familiar with the matter told affiliate title Venture Capital Journal that Johnson and the others continue in their current roles with Sequoia Heritage and Brookfield and that they were only named in the Form D because they represent Brookfield and Sequoia Heritage on Pinegrove’s board.

Pinegrove is led by Laibow, who was previously co-head of North America and managing director for Oaktree Capital Management’s flagship Global Opportunities strategy. He spent more than 17 years at Oaktree, departing last July to found Pinegrove in August, according to his LinkedIn profile.

Laibow is the only “control person” listed in the Form ADV, which states that he owns 75 percent or more of the firm. He is identified in the Form D as “manager and chief executive officer of the general partner of the issuer’s general partner”.