Vistara Growth goes evergreen with launch of sixth private credit fund

Vistara Growth, a Vancouver-based private credit investor, has officially launched its sixth fund, which it ultimately hopes to raise at $500 million USD ($700 million CAD). The vehicle, the Vistara Growth Structured Opportunities Fund, is structured as a permanent evergreen fund, a departure from the five closed-end funds the firm has raised and deployed since 2015. According to BetaKit, which conducted an exclusive interview with founder and managing partner Randy Garg, the firm sought to end the cycle of raising a new fund every two years, which Garg described as distracting and effort-intensive and a burden for LPs managing capital calls and distributions across multiple vehicles.

Vistara hopes to secure an initial close of between $200 million and $250 million USD by the end of November. The firm is already well positioned toward that goal through an anchor commitment of up to $125 million USD from Ryan Beedie via his family office. Beedie, a longtime LP who has anchored all of Vistara's funds to date, also acquired a 50 percent ownership stake in Vistara's general partnership through Beedie Capital, splitting the firm's 20 percent share of gains and annual management fee from the new fund. Garg described Beedie's commitments as "huge," and said the GP stake creates greater alignment. Beedie said in comments to BetaKit that the acquisition reflects his confidence in the organization and its growth opportunity.

The strategy remains consistent with prior funds: providing a mix of debt and equity to mid- and later-stage technology companies across North America, with a focus on firms with between $10 million and $100 million CAD in annual recurring revenue in sectors including AI, FinTech and healthtech. Vistara typically invests at the Series B stage and beyond and also finances bootstrapped businesses. Its structures often include equity sweeteners such as warrants or convertible debt. According to Garg, the evergreen structure allows greater flexibility on repayment terms and lets Vistara hold warrants and convertible positions for longer. Garg noted that many LPs are "set-it-and-forget-it-type investors" who prefer to draw income while principal compounds.

The move follows a difficult fundraising cycle for the fifth fund, which closed at $321 million USD a year ago after nearly two years of effort and fell short of its $386 million USD goal. Over 90 percent of that capital came from British Columbia, and Garg had previously indicated the firm wanted to emerge from the so-called "tweener" category by attracting institutional LPs outside the province. Per Garg, Vistara has raised close to $700 million USD to date and returned $600 million USD. The firm has fully returned its first two funds, posted a return above 120 percent on Fund III, and is approaching 100 percent on Fund IV. Some of its funds have been ranked top performers in their asset class by Preqin.

Alongside the launch, Vistara promoted John O'Donoghue and Neil Kenley to partner and hired Jyotin Handa as CFO. Handa previously spent a decade at Canadian private credit provider Espresso Capital working on evergreen fund structuring and management. Garg said Vistara has no current plans for additional new funds and may instead raise further capital for the Structured Opportunities Fund. The 15-person firm described the arrangement as setting the table for growth.