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Armed with TCAP talent, SharpVue fund looks for middle market deals

From the Triangle Business Journal:

A pair of investment veterans are eyeing deals across the nation – armed with a new fund they say could boost Raleigh’s reputation in the institutional capital arena.

Former state budget director Lee Roberts and new partner Doug Vaughn, previously the senior managing director and chief administration officer at TCAP, are spinning off SharpVue Capital. In addition to its more well-known real estate investment tract, that includes an opportunity fund aimed squarely at middle market companies.

“We think there’s still a lot of gems out there,” says Vaughn, who plans to use contacts and experiences gleaned at TCAP to help score Sharpvue wins.

Sharpvue was previously an arm of Curi, formerly known as Medical Mutual. Curi still serves as “strategic partner” and investor, having fronted about $100 million toward the new independent entity.

“We have closed on about $160 million across our strategies,” Roberts says. “We have targeted raising approximately another $100 million, away from the insurance company.”

It’s the Sharpvue Opportunity Fund, a lower middle market vehicle that is already two deals in, that has Vaughn – the new addition – excited about the opportunities ahead.

“We’re trying to create a platform, an alternative investment platform that gets Raleigh to where it should be,” he says, noting it has the potential to keep investment professionals in Raleigh after graduating area universities, and to bolster the region’s position in the institutional capital arena.

And the opportunity is high, he says. “Deal flow begets deal flow,” Roberts says. “Once you start doing a few deals, people start to know that you’re there.”

Flexibility will be key in its strategy, Vaughn says.

“We want to have a wide fairway,” he explains. “In that way, we can find great opportunities regardless of where we are in the cycle.. That means being able to move between debt and equity.”

He says it’s hard to capitalize on opportunities with “only one arrow in our quiver.” And those “opportunities” could manifest in multiple ways. He sees deals being led by debt, estimating a mix of about 70 percent debt to 30 percent equity – but says it’s not a steadfast rule.

“I don’t think there’s going to be a typical deal,” he says. “It’s going to be situational.” And check sizes, too, will vary, between $5 million and $15 million – funneled into firms making between $10 million and $100 million.

So far, the new opportunity fund has invested in California firm Pondera Solutions and a Durham company Roberts and Vaughn declined to disclose.