Revelation Partners: $608 Million Fund Closed, Substantially Surpassing $500 Million Target

By Amit Chowdhry ● Oct 30, 2023

Revelation Partners recently announced the closing of its $608 million Fund IV, substantially surpassing the healthcare investment firm’s initial target of $500 million. Now Revelation Partners manages $1.5 billion of committed capital as the firm provides liquidity and flexible capital solutions to investors, companies, limited partners, and general partners across all healthcare sub-sectors.

This oversubscribed Revelation Healthcare Fund IV offers Revelation additional capital to address the billions of dollars of illiquid equity interests in attractive, growing private healthcare companies. Interest in the firm’s strategy highlights the unique approach Revelation has pursued over the last ten years. And it also underscores limited partners’ interest in getting economic exposure to a diversified set of healthcare companies (medical devices, diagnostics, biotech, health-tech, and healthcare services) that are at a later stage and growing rapidly.

Revelation’s activity mirrors its rapid growth as a specialized healthcare investment franchise. And the firm has been growing at an annualized rate of over 40% for the last six years.

The ability for counterparties to wait for traditional liquidity events was exacerbated by the lack of liquidity in the current market environment. Over $200 billion has been invested in private healthcare companies over the last three years (NVCA data), but there has been little liquidity generated for those investments. Since the middle of 2021, there were few successful healthcare IPOs and few private M&A transactions for cash. For Revelation, this has translated to an active investment pace.

In the last 18 months, Revelation provided over $200 million of liquidity commitments to private investors. And these groups are wide ranging. Many venture investors and private equity firms need cash for supporting their portfolio or to generate liquidity for their investors. Some investors have legal constraints in a fund more than ten years old and they are legally required to seek a liquidity option. In many other cases, founders or employees of private companies seek cash for personal reasons. Revelation is able to provide cash to each of these counterparties in a challenging liquidity environment.

With its latest $608 million fund, Revelation Partners continue focusing on the expansion of private secondaries and utilize its expertise in providing shareholder liquidity, GP solutions, and growth capital to offer customized solutions for private healthcare companies and their investors.

KEY QUOTES:

“The close of our latest $608 million fund surpassed our initial target and presents a tremendous opportunity to continue our momentum within the private secondary market. In today’s dynamic healthcare sector, there are ample opportunities to continue our track record of providing liquidity to the illiquid market of private healthcare investments. We continue to see record deal flow at Revelation Partners.”

— Scott Halsted, Founder and Managing Partner.

“Revelation Partners is unique. We offer liquidity to a wide swath of counterparties for their minority equity interests in private healthcare companies. When these counterparties (founders, venture capital funds, limited partners, and general partners) do not want to wait for an M&A or IPO event, they can turn to Revelation as a credible alternative. Our flexible capital solutions are a source of cash for investors who may not otherwise receive liquidity for several years. In this environment, that is great news for private healthcare investors.”

— Mike Boggs, Managing Partner