Multiplicity Partners raises $160mn on strong returns from tail-end secondaries

February 13, 2025 (Preqin News) – Zurich-based Multiplicity Partners has raised $160mn for its latest secondaries fund, targeting tail-end and special situations opportunities across alternative asset classes.

LTO Fund IV will target ‘under-the-radar’ assets valued at below $10mn on a three- to five-year horizon, sourcing investment opportunities from underperforming third- or fourth-quartile funds.

‘We position ourselves as a “mosaic buyer” or the “backstop liquidity option,” offering liquidity on positions that others don’t care for. We are happy to team up with other secondary funds and let them pick the cherries and us to take the rest – as long as we get it at the right price,’ Andres Hefti, Partner at Multiplicity, told Preqin News.

‘Tail-end secondaries have a very attractive risk/return profile, provided they are carefully selected and priced at a substantial margin of safety. Additionally, they have a much shorter duration compared with traditional private market portfolios,’ Hefti said.

Multiplicity has raised four funds since its inception in 2010, spending its first five years as an intermediary before it started investing. It focuses on deals across asset classes in emerging markets, avoiding competition in the US and Western Europe, Andres said.

‘As a secondary buyer we often need a material discount to NAV to make it worthwhile. Sellers are usually very much focused on the reported NAV, whereas as a secondary buyer, “you cannot eat NAV”. Ultimately, we often find that sellers do not accept the necessary haircut to complete the sale,’ he said.

Its first fund closed in 2016 with $4mn raised, returning a 45.7% net IRR, while funds two and three are both currently reporting net IRRs of more than 20%, according to Preqin data. LTO Fund IV closed 22% over its initial target size of €125mn ($129.2mn), sourcing investment from family offices, high-net-worth individuals, and institutional investors.

At the other end of the secondaries market, Ardian announced a €30bn final close of its ninth secondaries fund, hitting its hard cap and becoming the largest private equity secondaries fund ever.

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