Key Takeaways
- • Princeton Equity Group closed its third fund, Princeton Equity Partners III, on September 29 with $1.3 billion in commitments, exceeding its $875 million target, according to ROI-NJ and the firm's announcement.
- • The first and final close came within two months, amid what the Dallas Business Journal describes as a difficult fundraising environment for private equity.
- • Fund III is more than twice the size of its predecessor, which raised $575 million in about five months; the first fund closed at $352 million in 2021.
- • Lazard served as exclusive placement agent and Proskauer Rose LLP as legal counsel on the raise, per ROI-NJ.
- • The firm, co-founded in 2019 by Doug Kennealey and Jim Waskovich, focuses on franchisors and multi-location businesses and has invested in more than 30 companies since 2006.
Summary
Princeton Equity Group said it closed its third fund, Princeton Equity Partners III, on September 29, bringing in $1.3 billion in commitments. The Dallas- and Princeton, New Jersey-based firm reached a first and final close in two months, and ROI-NJ reported the fund exceeded its $875 million target. The firm described the raise as significantly oversubscribed. The close came as private equity firms broadly face fundraising challenges, according to the Dallas Business Journal.
The firm's announcement credited the close to commitments from existing limited partners and new U.S. and international institutional investors, and said its investor base expanded, particularly in Europe. Per the Dallas Morning News, about 30% of Fund III's investors are from outside the United States. The fund has no sector focus beyond the firm's franchisor strategy. Fund III is larger than both predecessors: the first fund closed at $352 million in 2021 after fundraising began in January 2020, and the second raised $575 million in about five months, according to Kennealey.
Kennealey and Waskovich founded the firm in 2019 and serve as co-founders and managing partners. Princeton says it has focused on franchisors and multi-location businesses since 2006 and has invested in more than 30 companies. Its portfolio includes KidStrong, D1 Training, Barry's, Massage Envy, Strickland Brothers and European Wax Center, according to the Dallas Morning News; the announcement also names Amped Fitness and Ellie Mental Health. Kennealey told the paper that Princeton views the franchisor model as a source of attractive cash flow and believes in-person service businesses may be less exposed to AI-driven disruption. The firm uses its proprietary FusionPoint AI software to identify companies and founders, and typically approaches private businesses directly rather than through auctions.
The raise coincides with continued expansion in the franchise sector. The International Franchise Association's 2026 outlook projects U.S. franchise output to rise 1.6%, from $907.3 billion to $921.4 billion, with establishments growing 1.5% to 845,000 and employment rising by more than 150,000 jobs to nearly 8.9 million. These are sector-wide projections rather than evidence of Princeton's portfolio performance.
The firm's announcement credited the close to commitments from existing limited partners and new U.S. and international institutional investors, and said its investor base expanded, particularly in Europe. Per the Dallas Morning News, about 30% of Fund III's investors are from outside the United States. The fund has no sector focus beyond the firm's franchisor strategy. Fund III is larger than both predecessors: the first fund closed at $352 million in 2021 after fundraising began in January 2020, and the second raised $575 million in about five months, according to Kennealey.
Kennealey and Waskovich founded the firm in 2019 and serve as co-founders and managing partners. Princeton says it has focused on franchisors and multi-location businesses since 2006 and has invested in more than 30 companies. Its portfolio includes KidStrong, D1 Training, Barry's, Massage Envy, Strickland Brothers and European Wax Center, according to the Dallas Morning News; the announcement also names Amped Fitness and Ellie Mental Health. Kennealey told the paper that Princeton views the franchisor model as a source of attractive cash flow and believes in-person service businesses may be less exposed to AI-driven disruption. The firm uses its proprietary FusionPoint AI software to identify companies and founders, and typically approaches private businesses directly rather than through auctions.
The raise coincides with continued expansion in the franchise sector. The International Franchise Association's 2026 outlook projects U.S. franchise output to rise 1.6%, from $907.3 billion to $921.4 billion, with establishments growing 1.5% to 845,000 and employment rising by more than 150,000 jobs to nearly 8.9 million. These are sector-wide projections rather than evidence of Princeton's portfolio performance.
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