Taproot Capital has established the Taproot Talent Tree Executive Network, bringing together experienced professionals from across the private equity industry to support emerging investment managers. The initiative will provide participating firms with access to guidance involving operations, fundraising, investment processes, technology, legal matters, and other activities required to build institutional investment organizations.
Taproot is an alternative asset manager specializing in investments in first-time funds and partnerships with emerging and growing private equity firms.
Its strategy focuses on providing capital and additional resources to managers developing their investment platforms.
The new executive network expands those resources by connecting portfolio managers with professionals who have experience across different parts of the private equity industry.
The network will provide advisory support involving financial management, fund administration, deal sourcing, legal compliance, market analysis, talent recruitment, and human resources.
Additional expertise will cover technology innovation, public relations, and the perspectives of institutional limited partners.
These services are intended to address challenges facing newer private equity firms as they transition from smaller investment operations into larger institutional platforms.
Emerging managers often possess specialized investment experience but may require additional resources to develop fundraising operations, compliance systems, reporting practices, and other business infrastructure.
Taproot believes the executive network can help firms address those needs while allowing investment professionals to concentrate on their core strategies.
The initiative builds on Taproot’s existing approach of supporting investment managers beyond the provision of capital.
Its affiliated broker-dealer, SevenPoint Partners, provides fundraising and advisory services.
The new network is intended to complement these capabilities with access to professionals who can share experience involving organizational development and strategic decisions.
Members of the Talent Tree Executive Network are not employees of Taproot and will not receive cash compensation for participating.
However, certain members may be offered the opportunity to invest in Tap Root Capital Fund I without paying management fees or carried interest.
This arrangement differs from the terms generally applicable to other investors and creates a potential financial incentive for participating members.
The company disclosed that the investment opportunity represents noncash compensation and may create conflicts of interest.
Network members will provide advisory guidance only and will not make investment decisions on behalf of Taproot or its funds.
The arrangement is intended to give emerging managers access to perspectives from experienced industry participants without transferring investment authority.
Taproot is registered as an investment adviser with the U.S. Securities and Exchange Commission.
The firm focuses on seeding private equity managers and providing customized capital solutions that support business development and long-term growth.
Its strategy also seeks to provide institutional investors with exposure to emerging private equity managers.
Management sees the executive network as another component of its effort to support the creation and expansion of investment firms.
The initiative provides an additional channel for managers to obtain strategic guidance as they establish investment processes, build professional teams, and expand relationships with capital providers.
KEY QUOTES:
“Building a successful private equity firm involves more than a sound investment strategy and access to capital. We see tremendous value in bringing together professionals with different backgrounds and perspectives to help our partners navigate the opportunities and challenges of growing their firms.”
Eric Zoller, Co-Founder And CEO Of Taproot Capital
“We are excited to partner with the Talent Tree and are appreciative of their time and commitment. We look forward to the collaboration ahead.”
Matt Thornton, Co-Founder And President Of Taproot Capital
