Tailwater Capital

Co-founders Jason Downie and Edward Herring serve as managing partners and control all material investment decisions. Both came out of HM Capital's energy group and have operated together for over two decades. The firm has not installed an independent investment committee or outside non-executive directors on its deal-approval process.

Sourcing relies on the founding partners' multi-decade relationships with midstream operators, family-owned oilfield service companies, and environmental remediation founders across Texas and Oklahoma. The firm does not advertise an in-house origination technology platform. Its market position as a dedicated energy infrastructure buyer — in a space where generalist private equity firms have broadly retreated — means many deals come through bilateral negotiations rather than broad auctions.

Tailwater operates as a direct investor, taking control or structured minority stakes in portfolio companies through its commingled fund vehicles. The firm does not publicly operate a fund-of-funds program or make LP commitments to third-party energy managers. Its limited partners are institutional allocators who commit directly to the Tailwater Energy Fund series.

The firm targets growth equity, management buyouts, and expansion-stage investments in established midstream and environmental infrastructure operators. Tailwater does not invest at the pre-revenue or early-stage technology development phase. Portfolio companies typically have existing operational assets, contracted cash flows, or established service relationships with upstream producers.

Tailwater does not invest in upstream exploration and production or downstream refining and marketing. The firm also avoids power generation assets including renewable project development — its energy transition exposure is limited to environmental infrastructure such as water recycling, carbon-capture-adjacent logistics, and emissions management services rather than electricity generation.

Tailwater Capital was formed in 2013 when Jason Downie, Edward Herring, and the energy investment team spun out of HM Capital (formerly Hicks, Muse, Tate & Furst). The separation was a structural break — Tailwater operates as a fully independent firm with no ongoing affiliation, shared economics, or legacy fund management ties to HM Capital.

Tailwater has not publicly marketed a formal co-investment program for external general partners. The firm typically leads or co-leads transactions through its own fund vehicles. On larger midstream platform deals requiring outsized equity checks, Tailwater has structured syndicates with like-minded energy investors, but those arrangements are deal-specific rather than programmatic.