Ex-Blackstone PE Veteran Launches Secondaries Business

SQ Capital, a new private equity secondaries firm, has been established under the stewardship of former Blackstone executive Mustafa Siddiqui with the objective of capitalizing on the increasing demand for liquidity in the middle market segment.

SQ Capital’s strategy is centered on PE assets that have been largely unexplored by existing secondaries managers through a combination of equity and equity-like investments in both LP interests and continuation vehicles.

“The secondary market is at a major inflection point — last year’s market volume, already at close to $150 billion, represents only 2% of total private equity assets under management and the opportunity set is growing much faster than the ready supply of dedicated capital,” said Siddiqui, founder and CEO of SQ Capital.

Siddiqui most recently served as global head of GP Stakes at Blackstone. Under his leadership, the company obtained minority interests in firms such as Nautic Partners and FTV Capital. He started his private equity career at General Atlantic in 2002, subsequently spending nearly 15 years at Blackstone.

The launch occurs at a pivotal moment for the private equity sector, which has experienced a 65% decline in exit flows since 2021, leading to almost 28,000 unsold portfolio businesses. Among them, 40% have been retained by private equity funds for over four years, resulting in heightened need for liquidity solutions.

NYC-based SQ Capital plans to implement an AI-native approach, utilizing a proprietary system called SQORE to evaluate secondary opportunities.