Revelation Partners Taps Prashant Gangwal as CFO

Revelation Partners, a New York-based secondaries firm focused exclusively on healthcare, has appointed Prashant Gangwal as Partner and Chief Financial Officer, marking the latest senior hire as the firm scales its operations amid surging demand for GP-led continuation vehicles.

Gangwal joins from BlackRock's private equity solutions group, where he spent five years structuring secondary transactions and co-investment deals. Before that, he served as CFO of Fortress Investment Group's private equity and credit business from 2012 to 2020, overseeing financial operations across a portfolio that peaked at over $40 billion in assets under management.

The hire comes as Revelation — founded in 2020 by former Goldman Sachs and Webster Equity Partners executives — positions itself within the fastest-growing segment of the secondaries market. GP-led deals, where fund managers transfer portfolio companies into continuation vehicles rather than selling outright, accounted for $73 billion of the $108 billion in total secondaries volume in 2023, according to Jefferies data.

"Healthcare secondaries require a different set of muscles than traditional buyout investing," said David Katz, Managing Partner at Revelation Partners, in a statement. "Prashant's track record at BlackRock and Fortress — navigating complex deal structures, managing LP relationships, and running finance operations at scale — is exactly what we need as we move into our next phase."

Revelation Partners launched with a thesis that healthcare assets — particularly in life sciences, med tech, and specialty pharma — would become stranded in aging funds as traditional exit routes narrowed. The firm's strategy centers on acquiring LP stakes and leading GP-led secondaries in healthcare-focused funds, often stepping in when sponsors need liquidity but aren't ready to sell portfolio companies outright.

That bet has played out. The average holding period for U.S. private equity-backed healthcare companies stretched to 6.3 years in 2023, up from 4.8 years in 2019, according to PitchBook. Strategic buyers have grown more selective, particularly in biopharma, where regulatory risk and clinical trial timelines complicate M&A. IPO windows have been largely shut since 2021.

Continuation funds offer an alternative: roll strong-performing assets into new vehicles, give existing LPs liquidity, and attract fresh capital to fund the next stage of growth. For healthcare assets — where value creation often hinges on multi-year product development cycles or regulatory approvals — the strategy can make sense. But it also raises questions about valuation marks, conflicts of interest, and whether sponsors are gaming fund economics.

Revelation has stayed quiet about its deal flow, but industry sources say the firm has participated in at least three healthcare-focused continuation vehicles over the past 18 months, including a transaction involving a late-stage orthopedic device company originally held in a 2017-vintage fund.

Gangwal's resume reads like a tour through the institutional side of alternative investments. At BlackRock, he worked within the Strategic Partners group — one of the largest buyers of LP stakes and GP-led secondaries globally, with over $100 billion in committed capital. His role involved underwriting complex secondary transactions, often involving partial portfolio sales or restructured fund terms.

Before that, his eight-year stint as CFO at Fortress gave him a front-row seat to the operational challenges of running a multi-strategy alternative asset manager. Fortress managed private equity, credit, and real estate funds simultaneously, requiring Gangwal to navigate disparate waterfall structures, LP reporting requirements, and capital call schedules across dozens of vehicles.

That experience matters more at a secondaries firm than it might elsewhere. Unlike traditional buyout shops that raise a fund, deploy it, and harvest exits on a predictable timeline, secondaries investors operate in a messier environment. They're buying into funds at various stages of maturity, inheriting legacy governance structures, and often negotiating with multiple stakeholders — LPs looking to exit, GPs seeking capital, and portfolio company management teams caught in between.

Gangwal also spent a decade earlier in his career at Ernst & Young and Deloitte, primarily in audit and financial advisory roles serving private equity clients. That grounding in fund accounting and regulatory compliance becomes critical as secondaries firms scale — especially when dealing with healthcare assets subject to FDA oversight, reimbursement risk, and complex earnout structures tied to clinical milestones.

One aspect of the CFO role at a secondaries firm that often goes underappreciated: LP relationship management is harder than in traditional PE. Revelation's LPs aren't just capital partners — they're often selling LPs from the funds Revelation is buying into. That creates a delicate dynamic. The firm needs to maintain trust with sellers, many of whom are institutions that might co-invest in future deals or introduce deal flow.

Revelation's expansion comes as the healthcare secondaries niche gains traction. At least four other firms have launched healthcare-dedicated secondary strategies since 2021, including Coller Capital's healthcare fund-of-funds strategy and a joint venture betweenLex Health and a European family office that closed on $320 million last year.

The drivers are structural. Healthcare private equity has grown into a $150 billion asset class, but exit velocity hasn't kept pace. Strategic buyers remain cautious after a wave of overpriced deals in 2020-2021 led to write-downs. Public market comps have compressed, making IPOs less attractive. And regulators — both in the U.S. and Europe — are scrutinizing PE-backed healthcare rollups, particularly in physician practice management and behavioral health.

That's created a backlog of unsold assets. More than 60% of healthcare companies in private equity portfolios have been held for five years or longer, according to Bain & Company's 2024 Global Healthcare Private Equity Report. Many of those companies are performing well — EBITDA up, revenue growing — but lack a clear path to exit in the next 12-18 months.

Continuation vehicles solve that mismatch. GPs can retain ownership of high-conviction assets, give LPs an exit option, and reset the clock on fund life. For secondaries buyers like Revelation, it's an opportunity to acquire stakes in mature, cash-flowing healthcare businesses at a discount to what they'd pay in a primary fundraise.

But the strategy has critics. Some LPs argue that GP-led deals allow sponsors to avoid accountability for missing original exit timelines. Valuation disputes are common — especially when GPs are effectively selling assets to themselves. And there's a conflict embedded in the structure: the GP is both seller and ongoing manager, which can lead to questions about whether new LPs are getting a fair deal.

Revelation's pitch centers on sector expertise. The firm's four founding partners collectively spent over 60 years investing in healthcare before launching the platform. That matters more in secondaries than in primary buyouts, because underwriting requires deep operational and regulatory knowledge — not just financial modeling.

When evaluating a continuation vehicle involving a medical device company, for example, Revelation's team can assess FDA approval risk, reimbursement pathways, and competitive positioning in ways that generalist secondaries buyers might miss. That allows the firm to move faster and bid more aggressively on deals where it sees asymmetric upside.

Gangwal's appointment suggests Revelation is preparing for a fundraise. The firm has been investing out of a debut fund that closed in 2021 on an undisclosed amount — industry sources peg it at $250-300 million. That fund is now more than halfway deployed, according to people familiar with the matter.

A second fund would likely target $500 million or more, aiming to participate in larger continuation vehicles and compete with established secondaries giants like Lexington Partners and StepStone Group. Bringing on a CFO with Gangwal's institutional pedigree signals to LPs that the firm is building the infrastructure to operate at scale.

It also reflects a broader maturation of the secondaries market. A decade ago, secondaries was a cottage industry dominated by a handful of specialists. Today, it's a core allocation for most institutional investors, with dedicated strategies from firms like Goldman Sachs, Blackstone, and Ardian. As the market professionalizes, operational rigor — fund accounting, compliance, LP reporting — becomes a differentiator.

Revelation hasn't disclosed specific deal targets for 2025, but Katz has said publicly the firm sees the most opportunity in three areas: life sciences companies that have cleared Phase 2 clinical trials but still need 3-5 years to reach commercialization, specialty pharma platforms with bolt-on acquisition potential, and healthcare services rollups where regulatory headwinds have slowed exit timelines.

One variable Revelation — and every healthcare-focused investor — is watching closely: regulatory scrutiny. The FTC has blocked or challenged several PE-backed healthcare deals over the past two years, including Welsh, Carson, Anderson & Stowe's attempted acquisition of a dermatology platform and a proposed anesthesiology roll-up backed by a California-based firm.

There's also been noise at the state level. California, New York, and Massachusetts have all introduced legislation requiring private equity firms to disclose portfolio company financials and notify regulators before acquiring healthcare providers. None of those bills has passed yet, but the direction of travel is clear.

Revelation's growth — and Gangwal's hire — are symptoms of a larger shift. Secondaries are no longer a niche liquidity solution. They're becoming the primary exit mechanism for a growing share of private equity assets.

That's especially true in sectors like healthcare, where traditional exits are constrained. If IPO markets stay shut and strategic buyers remain cautious, continuation vehicles will keep capturing market share. In 2023, secondaries volume hit an all-time high. Early data from 2024 suggests that trend continued.

For firms like Revelation, that creates opportunity. But it also raises stakes. As more capital floods into secondaries, pricing has tightened. Discounts to NAV — once 20-30% on LP-led deals — have compressed to high single digits on competitive processes. GP-led deals often trade at or above the sponsor's reported valuations, which means buyers are betting on future value creation rather than acquiring assets on the cheap.

That makes operational expertise critical. Revelation can't just be a financial buyer — it needs to add value post-transaction, whether through portfolio company support, follow-on capital, or strategic introductions. That's where sector focus pays off.

Gangwal's appointment is unlikely to be Revelation's last hire of 2025. Industry sources expect the firm to add at least one more investment professional and potentially a head of investor relations ahead of a Fund II launch later this year.

The broader question is whether healthcare secondaries can sustain the momentum. Exit timelines might normalize if IPO markets reopen or if strategic buyers regain confidence. That would reduce the need for continuation vehicles. But most investors betting on the space — Revelation included — think the structural drivers are durable.

Healthcare will keep getting more capital-intensive. Drug development cycles won't suddenly shorten. Regulatory risk isn't going away. And private equity has invested too much capital into the sector over the past decade to walk away. That means exit logjams will persist — and secondaries firms positioned to provide liquidity will keep finding opportunities.

For now, Revelation is building. Gangwal's hire gives the firm credibility with institutional LPs and operational bandwidth to pursue larger, more complex deals. Whether that translates into outperformance depends on execution — and on whether the healthcare secondaries thesis holds up over the next five years. But the firm's timing looks right. Exit pressure is real, continuation vehicles are here to stay, and the market for healthcare secondaries is just getting started.