Remote epitaxy is a promising approach for synthesizing exfoliatable crystalline membranes and enabling epitaxy of materials with large lattice mismatch. However, the atomic scale mechanisms for remote epitaxy remain unclear. Here we experimentally demonstrate that GaSb films grow on graphene-terminated GaSb (001) via a seeded lateral epitaxy mechanism, in which pinhole defects in the graphene serve as selective nucleation sites, followed by lateral epitaxy and coalescence into a continuous film. Remote interactions are not necessary in order to explain the growth. Importantly, the small size of the pinholes permits exfoliation of continuous, free-standing GaSb membranes. Due to the chemical similarity between GaSb and other III-V materials, we anticipate this mechanism to apply more generally to other materials. By combining molecular beam epitaxy with in-situ electron diffraction and photoemission, plus ex-situ atomic force microscopy and Raman spectroscopy, we track the graphene defect generation and GaSb growth evolution a few monolayers at a time. Our results show that the controlled introduction of nanoscale openings in graphene provides an alternative route towards tuning the growth and properties of 3D epitaxial films and membranes on 2D material masks.