Europe’s natural mid- and lower-mid-market is a good fit for the secondaries specialist, founder Michael Bego tells PE Hub.

Craig McGlashanub

Kline Hill Partners is opening a London office, PE Hub can reveal, as the secondaries specialist adds a second location in a European market that “really ties in well” to the firm’s approach, founder and managing partner Michael Bego told PE Hub in an exclusive interview.

The office will provide GPs, LPs and investors with GP-led and secondary direct transactions as well as LP fund transfers in private equity, growth equity and other strategies.

Kline Hill hopes to serve what it called “the region’s underserved small LP- and GP-led transactions market.” Kline Hill focuses on CVs below $250 million and LP transactions below $100 million, although on the LP side it often buys positions from large funds.

But the smaller ticket size does mean that Europe is a good fit for the Greenwich, Connecticut-headquartered firm, which opened a Zurich office in 2021. “In the US, there’s a bigger preponderance of very large private equity funds. In Europe, there’s more of a natural middle-market and lower-middle market,” Bego told PE Hub. “That really ties in well to Kline Hill’s small-deal approach.”

Kline Hill Partners James Bradshaw will head the London office and focus on building relationships in the region. He joined from Deloitte UK in 2019, not long after Kline Hill’s founding in 2015.

“James has been a Chuck Norris of deal expertise for us,” said Bego. Gopi Selveswaran joins as director and will lead European business development and investor relations from the London office. He’ll also work to expand investor coverage across the Middle East and Asia.

Selveswaran was most recently director of investor relations at Balderton Capital. He spent years on the investor relations team at Bridgepoint and began his career at Aureos Capital.

Full coverage
Kline Hill has transferred approximately 3,400 fund interests and closed over 800 deals since its founding, including more than 145 deals in the past 12 months. It has $6.1 billion in AUM and also has an office in the Philippines.

It is keen to service all of Europe, with Zurich taking care of the central part of the continent. “London is a central financial hub for the region. We really want to cover that and make sure we’re close to everyone there, ” said Bego. “That’s why we have the two offices. They’ll coordinate and maybe there’s some important relationships that we might serve from both offices. But we’ll best serve Europe with the two offices.”

UK deals involving Kline Hill include its lead of the £200 million ($268 million; €231 million) Growth Partnership Fund, raised by Phoenix Equity Partners last year to extend its investment in Nineteen Group and Envisage Dental.

Kline Hill will make two other hires for the London office to work alongside Bradshaw and Selveswaran, while a team member from the US is likely to join for a year to help train the office. Further hires are expected down the line.

The firm is also looking at launching other strategies and other offices. The company also has a primary program, in which it backs 55 managers, that it is looking to expand.

It also sold a slice of itself to TA Associates earlier this year.

Kline Hill’s Europe push comes as secondary funds “have ballooned in size,” said Bego. “The vast majority of the dollars now sit in funds over $10 billion. All of those liquidity providers are working on huge LP deals, huge continuation vehicles. The reality is there are a lot of allocators and people that need liquidity in the industry, where it needs to be in smaller amounts. This size range is where Kline Hill’s specialty is, and providing the liquidity with top-quality service.”