Qualitas launches €200m fourth fund-of-funds

Qualitas Funds IV has raised €60m to date and expects to hold a final close by the end of 2021, the GP told Unquote.

The fund targets net IRR of 15% and a 2x return for its investors. 

The firm has also announced the final closing of Qualitas Funds III, which has collected €130m, exceeding its target of €120m. The vehicle has 20% capacity to overcommit and reach up to €160m.

Qualitas Funds III is fully committed across 13 mid-market funds. 

"The GPs selected for the Qualitas Funds III portfolio have a strong track record, with an average historical gross IRR in excess of 40%, above the European market average of 20%," said Eric Halverson, founding partner of Qualitas Funds.

He added: "Our strategy is multi-sectoral and diversified; we want our product to be a mirror of the European economy. This investment thesis has driven attractive returns with a low risk profile, even amid market downturns."

Qualitas Funds uses its proprietary market intelligence program to select a portfolio of funds from a pool of nearly 2,000 eligible fund managers across Europe.

Founded in 2015 by Sergio García and Eric Halverson, Qualitas Funds is a Spanish manager specialised in funds-of-funds, investing in the mid-market in Europe and North America. Employing 30 professionals, the firm manages 10 investment vehicles with €500m in assets under management.

Qualitas Funds is part of the Qualitas Equity Group, an alternative assets firm founded in Madrid in 2003. The group has €3bn in assets under management.

Investors
The fund's LP base is composed of institutional investors, asset managers and private banks, primarily from Spain.

Investments
Qualitas Funds IV will follow the same investment strategy as its predecessor, investing in fund managers operating across the lower-mid-market in Europe and North America.

The fund deploys equity tickets of around €10m per fund. It has already made six direct GP investments and one secondaries deal.

The fund intends to deploy 75% of its capital across Europe, primarily in Germany, the Benelux region, France, Italy, the Nordic region, the UK and Switzerland. The remaining 25% will be deployed in North America.

Qualitas Funds IV invests in generalist funds but has been increasing its exposure to funds specialised in technology and healthcare. 

Halverson said: "In the last few years we have increased our exposure towards some promising sectors, including technology, software, fintech, e-commerce and healthcare, which have performed particularly well during the pandemic."

Around 70% of the capital will be committed in 18 months to primary GP transactions, while the remaining 30% will be deployed over a longer period of time in secondaries deals and co-investments, the GP told Unquote.

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