Q&A: Star Mountain Raises Capital on Palico

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Brett Hickey is chief executive and founder of Star Mountain Capital, a private equity manager focused exclusively on credit and equity investments in the U.S. lower middle market. He explains here why Star Mountain chose to fundraise using Palico’s digital marketplace.

What was the advantage of using Palico for Star Mountain’s recently closed fund?

BH: We secured several commitments using Palico and the standout element was the remarkable efficiency of the digital marketplace. It really saved us time by ensuring that extensive, detailed information about our philosophy, tactics and track record went to investors with a stated interest in our strategy. Because the investors who committed to our fund were able to screen us ahead of time, we cut through a lot of the extraneous meetings and correspondence that a general partner otherwise has to go through before getting to the meat of the business, profitable investing. In sum, we raised capital quickly and closed our fund more rapidly than would have been the case without Palico.

How would you describe the investors you found using Palico?

BH: They’re an exceptionally knowledgeable and relevant group, keen to dig into the details of how we invest. That’s tied to the fact that on Palico fund managers meet investors who share the same investment interests. The group of investors we won commitments from are also diverse in terms of geography and type. In fact, Palico helped us put together a particularly resilient, uncorrelated investor base.

Did using Palico pose any particular challenges for you?

BH: No, it’s easy to use. And crucially, when it comes to compliance issues, everyone that sees our fundraising documents and that requests meetings with us on Palico is accredited. The whole point of Palico is that it cuts down on complications and wasted time so that everyone is served better.


Palico Democratizes Private Equity Investment

Although it fits seamlessly with traditional means of raising capital, Palico is altering private equity fundraising and secondary sales with a digital approach that makes products more accessible and affordable. Palico’s digital marketplace opens up fundraising and secondaries to big and small, wherever they are – whether investor, manager, gatekeeper, placement agent or secondary advisor.

“It’s great to push a button and see everything that’s out there. Palico helps me do my job better.”

Sabina Eder, Bank Austria

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About Palico

Palico is the leading digital marketplace for private equity primaries and secondaries specifically designed for fund managers and institutional investors.

Primary Platform: Palico’s primary platform is a comprehensive fundraising solution. GPs have access to a full array of digital tools to communicate and nurture prospective investors, including: Virtual Data Room, Messaging Module, Stats for fundraising performance, and Newsroom. Those tools are complemented with a matchmaking algorithm that alerts a vast LP member base (over 2,800 LP members and counting) of new fund investment opportunities and a notification system that notifies the LP network when the Newsroom is updated with major milestones and events.

Secondary Platform: Palico’s secondary marketplace, designed by PE industry experts, standardizes the process of selling and buying PE fund interests — especially for smaller transaction sizes (~$2 – $20M). The marketplace features nearly all traditional major secondary funds in addition to hundreds of non-traditional/opportunistic buyers. From single family offices to large pension funds, LPs are now a few clicks away from participating in and enjoying the versatility that secondaries provide to their PE portfolios.