Kudu Investment Management has purchased a stake in a firm similar to itself and focused on the healthcare industry.
Kudu said it is now a minority owner of Revelation Partners, one of the leading asset managers in the healthcare secondaries market. Revelation remains employee-owned and controlled and will continue to be led by co-founders and managing partners Scott Halsted and Mike Boggs. Terms of the deal were not disclosed.
Sausalito, California-based Revelation was founded in 2013 and specializes in providing capital to investors, companies, limited partners and general partners across the healthcare sector. It has more than $1.5 billion of committed capital, including its fourth flagship fund that raised $608 million and closed in October 2023. It is currently invested in more than 50 companies.
“We have seen record deal flow over the last couple of years, and Revelation is experiencing strong demand for our strategy of providing liquidity to the illiquid market of private healthcare companies,” Boggs said. “We are excited to partner with Kudu, which has the capital and experience to help us continue to optimize our large opportunity set.”
Revelation says it has grown at an annualized rate of over 40 percent for the last six years, a reflection of the healthcare industry’s expansion. Over $200 billion has been invested in private healthcare companies over the last three years, according to the National Venture Capital Association, but the IPO market has been dreary. Revelation gives founders and other healthcare company stakeholders a liquidity alternative to taking a company public.
Kudu CEO Rob Jakacki said in a statement that Revelation has built an “impressive franchise” in an exciting and evolving area of asset management.
The stake in Revelation is the first deal that Kudu has announced this year. In 2023, which was another robust year for GP stakes investors, Kudu invested in four asset managers: credit specialist and interval fund manager Variant Investments; healthcare-focused private equity firm Martis Capital Management; private-debt manager Apera Asset Management; and (mostly) fixed-income investor Sage Advisory Services.
Since it was founded in 2015, New York-based Kudu has invested in 28 asset and wealth managers in the U.S., Canada, U.K., and Australia. Its portfolio companies collectively invest approximately $129 billion for investors. It’s backed by White Mountains Insurance Group and MassMutual.