Dan Sundheim’s D1 Capital Partners is seeking to raise more than $1bn for its first standalone private equity fund, marking a major expansion of the New York-based firm’s exposure to illiquid assets, according to sources cited by Bloomberg.

The vehicle will be structured as D1’s first traditional private equity fund, featuring a hard close and a defined investment period. The fund’s final close is expected next year, according to people familiar with the plans.

D1, which manages about $24.5bn, has historically invested in private companies through side pockets in its hedge fund. Private equity already accounts for around 60% of its total assets, with high-profile holdings including SpaceX, Collectors Holdings, logistics group Lineage, and credit-card startup Ramp. The firm also held a stake in Instacart before its listing.

Founded in 2018 by Sundheim, a former Chief Investment Officer at Viking Global Investors, D1 quickly became one of the most active cross-over investors in both public and private markets.

The firm suffered steep losses during the 2022 tech downturn, its hedge fund fell 30.5% that year, but has since staged a strong recovery. D1’s equity portfolio is up nearly 24% in 2025 through September, buoyed by a resurgence in technology valuations and improving liquidity in private markets.

The move into traditional private equity fund structures marks a significant evolution for D1, reflecting a broader trend among hedge funds diversifying into longer-duration investment strategies to capture value in private markets.

If you think we missed any important news, please do not hesitate to contact us at news@pe-insights.com.

Can`t stop reading? Read more.