HCAP Fund III L.P.

Founded in 2000, HCAP Partners LLC (HCAP, formerly Huntington Capital) is a private equity firm focused on the lower middle market generating top quartile returns while facilitating positive impact on underserved businesses, their employees and their communities through active portfolio engagement. These results are evident in our financial performance and impact metrics.

HCAP provides capital to “underserved” businesses that tend to employ low-to-moderate income and ethnic minority employees, are located in LMI zones, and/or are owned and operated by ethnic minorities. The Fund primarily provides growth capital, structured as Mezzanine Debt and/or Structured Equity. Members of the General Partner have successfully completed 57 investments over the past 10+ years across three funds: HCAP, L.P. (vintage 2001), HCAP Fund II, L.P. (vintage 2008) and HCAP Fund III, L.P. (vintage 2013).

Financial description

The principle objective of The Fund is to generate above average returns for our investors by providing the investment capital and resources to help our portfolio companies maximize their performance and enterprise value and facilitating a positive impact within the underserved businesses and communities in which we invest.
As of June 30, 2015, $27.6M or 30.7% of committed LP capital has been called for HCAP Fund III. Gross IRR on portfolio investments, excluding fees, expenses and carried interest, is 15.3% since inception with a 1.12x investment multiple. Due to the early stage of this fund net IRR calculations are not yet meaningful and we continue to report the Fund’s return on a gross basis.
The investments will generally be structured as mezzanine capital, typically as loans in the $2-9 million range. The Fund also provides growth capital in the form of preferred stock. Funds are typically used for growth oriented working capital, recapitalization, acquisition or for capital investment.