Placement Agent Firms Cleantech Fund-of-Funds

Hey, who put the placement group in my fund-of-funds?

That would be Solution Capital Partners, a cleantech-focused fund-of-funds manager that has been formed in partnership with placement agent Far Hills Group. Specifically, Solution will be run day-to-day by Russell Diamond, who previously ran a smaller cleantech-focused fund-of-funds called R&D Capital Partners. Before that, he was a general partner with Saratoga Ventures. Solution’s investment committee, however, will include members of Far Hills Group – who also will provide due diligence assistance on potential investments, and help raise the actual capital. Furthermore, the two firms are sharing office space.

Geoffrey Bradshaw-Mack, a managing director with Far Hills Group, says that the joint venture was borne of individual Far Hills pros investing with Diamond’s prior fund. He adds that many LPs have indicated strong interest in cleantech – particularly given the pending stimulus bill – but that some are seeking a broadly-diversified strategy.

To that end, Solution is seeking to raise $200 million, with a $350 million cap. About a quarter of that would be allocated to early-stage VC, about half to growth-stage/late-stage and the remainder to “opportunistic” situations (including passive co-investments). It only expects to invest in pure-play cleantech funds, although would consider cleantech-specific sidecars of more sector-agnostic firms.

I did ask Diamond about the glaring lack of cleantech exits, and he replied that it was mostly just a matter of time. We’ll have to see if the LP community agrees.