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Pacific Avenue Capital Partners (Pacific Avenue) is a Los Angeles-based private equity firm founded in 2018 by Chris Sznewajs, a Certified Public Accountant (CPA) with an MBA from Northwestern University’s Kellogg School of Management. Sznewajs, who serves as Managing Partner, has extensive experience in private equity, operations, and M&A. The firm specializes in middle-market investments, particularly corporate divestitures, carve-outs, and other complex situations where businesses face operational or strategic challenges. Pacific Avenue partners with management teams to drive transformation and sustainable growth in mission-critical industries such as industrial, manufacturing, and services. The firm manages approximately $3.8 billion in assets under management (AUM), having completed over 120 transactions, including more than 50 corporate divestitures. The team includes key partners like Jason Leach and James Oh, with recent expansions including a Paris office opened in December 2024 to support European growth, led by Managing Director Xavier Lambert.
Details of the Latest Fund Closing: Pacific Avenue Fund II
Pacific Avenue closed its latest fund, Pacific Avenue Fund II (“Fund II”), with more than $1.65 billion in committed capital. This includes a dedicated €100 million-plus sidecar vehicle focused on European opportunities, enabling targeted investments in the region amid the firm’s international expansion. The fundraising process was remarkably efficient, completing in a single closing within less than four months, and was significantly oversubscribed, reflecting strong investor demand.
- Fund Size and Structure: The $1.65 billion total is approximately three times the size of its predecessor, Pacific Avenue Fund I, which closed in April 2023 with commitments exceeding $500 million. The sidecar vehicle enhances flexibility for European deals, aligning with recent acquisitions like the June 2024 purchase of Sogefi Filtration S.A. and Sogefi USA Inc. (now Purflux Group) and the planned acquisition of FLSmidth Cement announced in June 2025.
- Investor Base: Fund II attracted a diverse group of global limited partners (LPs), including public pensions, consultants, endowments, foundations, insurance companies, funds of funds, and family offices. It received support from both new and existing investors, indicating confidence in the firm’s track record.
- Advisors: Lazard acted as the exclusive placement advisor, while Weil, Gotshal & Manges LLP provided legal counsel.
Recent portfolio activity under Fund II and prior vehicles includes acquisitions such as KiddeFenwal (fire suppression systems, closed July 2024), the North American Flooring Business from H.B. Fuller (closed December 2024), and ongoing deals like FLSmidth Cement, demonstrating active capital deployment in carve-outs generating significant revenue (e.g., Purflux Group with over $600 million in 2023 revenue).
Strategic Focus and Differentiation
Pacific Avenue’s investment strategy emphasizes being the “premier global partner for corporate carve-outs and complex transactions.” This niche allows the firm to acquire undervalued assets from larger corporations, often in industries requiring operational turnaround. By leveraging deep M&A and operational expertise, the firm collaborates with management to unlock value, which has proven effective in a market where traditional buyouts face high valuations and competition. The European sidecar is a strategic addition, capitalizing on opportunities in a region with increasing corporate restructuring due to economic pressures like inflation and supply chain disruptions. This aligns with the firm’s recent office opening in Paris and hires like Xavier Lambert, positioning Pacific Avenue for cross-border growth.
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Performance and Fundraising Success in Context
The rapid, oversubscribed closing of Fund II—tripling the size of Fund I in just over two years—stands out in a challenging 2025 private equity fundraising environment. According to industry reports, global private equity capital raised in the first half of 2025 totaled around $27 billion across 238 funds, a sharp decline from 2022’s peak of $197 billion, with fundraises taking longer due to LP caution amid high interest rates and geopolitical uncertainties. Middle-market PE, however, has shown resilience, with deal volume up 10.9% in 2024 (trending into 2025) driven by lower borrowing costs and increased private credit availability. Carve-outs remain a key value-creation avenue, as noted in PwC’s mid-2025 outlook, where they offer opportunities in tight deal conditions despite average internal rates of return (IRRs) lagging behind top-tier deals.
Pacific Avenue’s success can be attributed to several factors:
- Track Record: Fund I’s quick deployment into high-profile carve-outs (e.g., Purflux Group) built investor trust, leading to re-ups and new commitments.
- Market Fit: In a recovery phase for PE (as per Bain & Company’s 2025 outlook), carve-outs provide defensive plays in mission-critical sectors, mitigating risks from economic slowdowns. McKinsey’s Global Private Markets Report highlights a shift toward specialized strategies like Pacific Avenue’s, with exits up 175% in Q1 2025.
- Efficiency: The sub-four-month raise contrasts with industry averages, where fundraises often extend beyond 18 months (Preqin’s 2025 outlook). This efficiency underscores the firm’s strong LP relationships and differentiated approach.
- Risks and Opportunities: While oversubscription signals optimism, broader trends like sustained high rates (potentially not dropping below 3% by year-end, per Ropes & Gray) could pressure leveraged deals. However, Pacific Avenue’s focus on operational improvements positions it well for value creation, potentially delivering above-average returns in a market favoring innovation and strategic investments (Cherry Bekaert’s 2025 report).
Implications and Outlook
This fund closing bolsters Pacific Avenue’s ability to pursue larger, more complex deals, potentially accelerating AUM growth beyond $3.8 billion. With a portfolio generating $2.6 billion in combined revenue (as of September 2024), the firm is well-equipped for further expansions, such as additional European acquisitions. In a broader PE landscape poised for moderate recovery—with fundraising improving but still constrained—the closing validates specialized middle-market strategies. Investors may benefit from diversified exposure to resilient industries, though success will hinge on execution amid ongoing macroeconomic headwinds.
Overall, Fund II’s closing marks a milestone for Pacific Avenue, highlighting its evolution from a 2018 startup to a $3.8 billion AUM player in under seven years, with strong momentum for 2025 and beyond.
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