Keystone Hauls in $630M for 2nd Institutional Raise

Keystone Capital Management, a lower middle market alternative investment manager, announced the one and done closing of Keystone Fund III at its hard cap of $630 million. The oversubscribed fund was completed in four months, which comes nearly three years after it raised $420 million for its debut institutional fund.

The fundraise is only the second outside capital raise in the firm’s 30-year history.

Since its inception in 1994, Keystone has undertaken 170 acquisitions in areas such as engineering and technical services, technology-enabled services, commercial services, and food and beverage production.

The firm invests in firms with EBITDA between $2 million and $15 million, with the goal of gaining majority ownership.

“For over 25 years, Keystone invested only the personal capital of its employees. It is incredibly gratifying to see the firm transition to outside, third-party capital and not change its time-tested strategy,” said Kent Dauten, Keystone Chairman.

Kirkland & Ellis LLP provided legal counsel on the fundraise for Fund III, which was raised without a placement agent.