Ex-Landmark Partners secondaries veteran launches PE firm with Goldman backing

The firm counts former TPG, Warburg Pincus, Partners Group and Accel Partners professionals among its staff and will take passive stakes in sports franchises.

A former top executive at Landmark Partners has teamed up with a sports entertainment industry veteran and other executives to launch an investment firm focusing on the sports industry with the backing of Goldman Sachs Asset Management‘s minority stakes business.

Ian Charles
Charles: Founded Arctos last year

Ian Charles has co-founded Arctos Sports Partners, which describes itself as the “premier private equity platform dedicated to the professional sports industry and sports franchise owners”, according to documents seen by sister publication Secondaries Investor. The firm takes passive minority stakes in professional sports franchises and provides liquidity and passive growth capital to sports franchise control owners and governors, the documents note.

“Our mission is to partner with owners and leagues to increase liquidity and financial flexibility for ownership groups using a collaborative, thought partner approach,” the documents say.

A vehicle named Arctos Sports Partners Fund I Feeder has been registered with the US Securities and Exchange Commission.

It is understood the firm will seek as much as $1.5 billion for Fund I, which will have an evergreen structure, and that it has raised around one-third of the total so far.

The firm counts Goldman’s Petershill unit as an anchor investor, according to a source familiar with the matter.

Private equity firms have turned their attention to the sports franchise entertainment industry – a roughly $300 billion market – in recent years. Last year Menlo Park-headquartered Silver Lake acquired a 10 percent stake in City Football Group, the parent of Manchester City football club. CVC Capital Partners has had its eye on Six Nations, Europe’s leading rugby union tournament, while KKR, Bain Capital and Platinum Equity are also active investors.

Arctos aims to write equity checks of between $20 million and $400 million and will focus on North American and European sports leagues such as baseball, hockey, American football and soccer.

It is understood the firm will target private equity-like returns and will not use leverage.

David O’Connor, who spent more than two decades at Los Angeles-headquartered Creative Artists Agency and who was the chief executive of Madison Square Garden prior to co-founding Arctos, is listed as a managing partner alongside Charles.

The firm is understood to have around 12 employees. These include at least three former Landmark professionals: partner Joseph Nasr, vice-president Zachary Baran and senior associate Tanner Houston, the documents show.

Jordan Solomon, Arctos’s fourth partner, spent time at McKinsey, the NBA and was an executive vice-president for sports at Madison Square Garden.

Arctos also counts former Partners Group, TPG, Warburg Pincus, Goldman Sachs and Accel Partners professionals as staff.

The firm’s investment strategy focuses on growth assets with “compelling financial and operating performance” in what is described as a “historically inefficient market”. The firm has offices in Dallas and New York, according its LinkedIn page.

Secondaries Investor reported in September that Charles had left the private equity and real estate secondaries firm where he had been a partner after 13 years. Landmark had noted to its investors at the time that Charles’s departure did not conflict with any of Landmark’s secondaries activities.

Charles is a secondaries market veteran who co-founded advisory firm Cogent Partners – which was acquired by Greenhill in 2015 – where he was responsible for origination, client relationships and research.

Charles declined to comment.