Scoop: Jared Kushner signs his first big private equity deal
Affinity Partners, the private equity firm formed last year by former President Trump’s son-in-law Jared Kushner, has agreed to invest in Mosaic, an Oakland, Calif.-based fintech company that provides loans for residential solar installations, Axios has learned from multiple sources.
Why it matters: This would be the first major deal for Affinity, which has raised more than $3 billion for its debut fund.
Details: Mosaic is said to be raising more than $200 million in Series D funding at a valuation north of $1 billion. Affinity is co-leading the round, which is expected to close later this quarter, alongside J. Safra Sarasin.
- There's talk that existing Mosaic investor Warburg Pincus may sell some of its stake into the deal, but still would be expected to remain the company's largest outside shareholder.
- JPMorgan and Citigroup are managing the process for Mosaic, which says it's funded more than $8 billion in solar and sustainable home improvement loans since inception in 2010.
The big picture: One surprise here is that Affinity's first big deal is in California instead of Israel.
- Affinity's fund, which hasn't yet held a final close, is primarily backed by sovereign wealth funds of Middle Eastern countries like Saudi Arabia. The WSJ recently reported that it has the ability to invest that money in Israeli companies, which is the first such known arrangement.
- Expect to see some Israeli deals soon for Affinity, which also is being investigated by House Democrats for potential conflicts of interest regarding its Saudi ties.
Future's so bright: The residential solar market saw huge growth last year, and a 2021 report from Wood Mackenzie suggested that loans were track to account for 70% of residential solar installations by 2023.
- Mosaic is part of a trio of companies, alongside GoodLeap and Sunlight Financial, that in 2021 controlled an 80% market share for residential solar loans.
- Rising interest rates could decrease demand for loan products, although Mosaic earlier this year lowered its prices.
The bottom line: Affinity appears to be one of several new investment funds that could benefit from their lack of legacy portfolios — getting to make their first deals at relatively low valuations.
Spokespeople for Affinity, Mosaic and Warburg Pincus all declined comment.