Fortitude’s lower mid-market private equity focus delivers robust returns in 2024
Nick Miller
2024 was a milestone year for Fortitude Investments, a leading private markets investment manager, reflecting the firm’s disciplined investment approach and strategic focus on the lower mid-market sector of the economy.
“Our ability to deliver significant returns in a challenging environment speaks to the strength of our strategy,” said Nick Miller, Fortitude’s partner and co-founder. “The lower mid-market segment continues to present compelling opportunities for value creation, with its abundance of investable companies and wide exit windows.”
A defining achievement of 2024 was the sale of Birch & Waite, a Fortitude portfolio company, to Quadrant in May. This transaction generated an impressive return for investors, contributing to Fortitude’s overall portfolio gross IRR of over 30% and over 3x Multiple on invested capital, and total net capital returned to investors to $625 million.
“The Birch & Waite transaction underscores our commitment to delivering exceptional outcomes for our investors,” Miller said.
“Private equity investments allow us to take a hands-on approach, optimising operational performance and strategically positioning businesses for growth,” he added. “This adaptability and focus on tangible value creation provides investors with a reliable pathway to generate strong returns over time.”
As public markets face increased volatility, private equity remains an attractive asset class for investors seeking stable and predictable returns. The ability to control and actively manage investments provides a significant advantage over other passive strategies, particularly in an uncertain economic environment.
“We expect institutional and high-net-worth investors to favour capital allocation to private equity, drawn by its proven track record of resilience and growth across market cycles.”
Despite a difficult investment climate, Fortitude maintained a strong deal pipeline, advancing 326 opportunities to early due diligence and moving $75 million worth of deals into exclusivity.
“Our discipline in selecting only the highest-quality opportunities has been key to our success,” said Miller. “2024 reaffirmed the soundness of our approach and the resilience of the lower mid-market sector.”
The year also saw Fortitude strengthen its team with the appointment of Chris Brookman as Chief Commercial Officer. Brookman will oversee sales, marketing, investor relations and operations, positioning the firm for continued growth.
Looking to 2025, Fortitude plans to focus on its four core investment themes: Food and Beverage, Technology and Digitalisation, Healthcare and Infrastructure/Energy Transition.
“Our pipeline remains robust across these sectors, and we see exciting opportunities to continue driving value,” said Miller.
The lower mid-market’s unique dynamics, including a transaction value nearly three times that of the mid-market and a less competitive landscape, make it particularly attractive for Fortitude.
“This segment offers the ideal combination of abundant opportunities and attractive valuations,” Miller noted. “By applying active management, we can help portfolio companies grow into mid-market-sized organisations, unlocking multiple arbitrages along the way.”
