Founded in 2011, Farol Asset Management, LP is an independent, partner-owned private equity firm focused on providing customized co-investment and direct investment solutions to institutional investors worldwide. The firm is led by a strong team of investment professionals with over 55 years of combined investment experience. At Farol and prior firms, we have deployed nearly $1.2 billion in equity capital.
Our key point of differentiation is our expertise in partnering with experienced operators, emerging managers and fund-less sponsors that are proven investors with limited access to capital. We serve as a value-added strategic partner at all stages of the investment process encompassing sourcing, diligence and monitoring. Our investment partners value our responsiveness and commitment to rigorous, disciplined and independent due diligence.
We invest private equity capital on behalf of institutional investors seeking to meet specific investment objectives that cannot be achieved through traditional private equity managers. Co-investment private equity is an area of increasing focus and commitment by institutional investors who lack the internal resources to execute these complex and time-consuming investments. We provide the expertise, resources and organizational alignment of interest to execute co-investment private equity supported by a proven track record of success. Farol has a demonstrated ability to invest alongside emerging managers and fund-less sponsors – a large, growing and underserved market segment.
Farol seeks to build a diversified portfolio investing across all industry sectors. We typically pursue transactions in the lower middle market and will consider opportunities of all sizes. Transaction types include buyouts, growth equity, carve-outs, take-privates and special situations.
We generally invest in niche companies that operate in stable industries that are market leaders with strong cash flow characteristics. We seek attractive entry points due to market inefficiencies that allow us to acquire strong companies at a meaningful valuation discount. The most critical part of our underwriting process is to identify multiple value creation opportunities including cost savings, acquisitions/divestitures, new product introductions and new market expansion — any combination of which if executed by management would allow us to generate strong risk-adjusted returns without multiple expansion at exit.
Overall, our target is to invest between $5-30 million in equity capital per transaction in opportunities brought to us by private equity firms, fund-less sponsors, entrepreneurs and operating executives.
NYSCRF PIONEER MANDATE
Farol currently manages a $250 million private equity co-investment separate account for the New York State Common Retirement Fund – a bespoke solution seeking to increase access to private equity capital for minority and women-led private equity funds, fund-less sponsors and businesses.