Private Equity Strategy

Valley Forge Private Equity (“VFPE”) invests in U.S. Lower Middle Market buyout funds (<$500M fund size) across multiple industries as well as selectively co-invests directly into portfolio companies alongside trusted fund managers. This hybrid structure ultimately targets portfolio companies generating $10-$100M of revenue and $5-$30M of EBITDA.

Why Private Equity?

  • Performance – Long-term Private Equity returns have outperformed the public markets
  • Diversification to Public Markets – Private Equity valuations are dictated far more by company level factors than broader market sentiment
  • Access to Deep Opportunity Set – 4,400 public U.S. companies versus 325,000 private U.S. companies have historically created opportunities to take advantage of an inefficient market
  • Dedicated Sponsors – Fund managers with deep experience take a hands-on approach to adding value

Why Lower Middle Market?

  • Opportunities – Larger pool of prospects with smaller companies having limited alternatives for capital
  • Control – Majority ownership enables experienced sponsors to direct strategy
  • Efficiencies – Opportunity for operational upgrades to industry standards, seeking to create synergy and value
  • Lower Purchase Prices – Lower purchase prices caused by greater supply can lead to better returns

Why Hybrid Fund Structure?

  • Access – Access to otherwise inaccessible fund managers by exceeding typical investment minimums
  • Due Diligence – Active monitoring and support of fund managers’ strategy and portfolio acquisitions
  • Fee Efficiency – Co-investing presents the opportunity to create a fee efficient investment vehicle
  • Diversification – Diversification by sponsor, industry, and geography through a single fund commitment

VFPE Differentiators

  • Develop long-term, high-quality, multi-level relationships with the Valley Forge network of value-oriented Private Equity fund managers, while avoiding early-stage venture/start-up risk
  • High conviction portfolio with two to four primary commitments per fund vintage historically
  • Generate attractive co-investment opportunities though VFPE’s “Value-Add” relationships with fund managers