(Bloomberg) — FTV Capital, a firm focused on growth-equity bets, has raised $2.3 billion for its largest fund to date.
The firm, which has offices in San Francisco and New York, will make investments in the enterprise-technology, financial-services and payments sectors through the vehicle, known as FTV VII LP, executives said in an interview. Bloomberg News in July reported that FTV had begun investor discussions on a record seventh fund.
“The pandemic has been a tailwind for digitization, and I’m excited about the application of new technologies, such as artificial intelligence, to a whole host of solutions,” managing partner Brad Bernstein said. “We’re seeing an integration of payments, lending and insurance into software solutions.”
The fund seeks to take either controlling or significant minority equity stakes in companies, writing checks of $30 million to $200 million. About 20% of the fund has been deployed, and investments include Plate IQ, a restaurant and hospitality accounts payable automation and payment platform, as well as True Potential, which the firm knew well from an earlier investment, said Karen Derr Gilbert, an FTV partner.
Founded in 1998, FTV aims to be the first institutional investor in companies. “The vast majority of our deals are proprietary opportunities where we’ve built relationships with management teams who are often bootstrapped entrepreneurs,” said Bernstein.
Since the start of 2020, it has amassed $3.2 billion by shedding holdings in companies including Enfusion Inc., A-LIGN and VPay, a figure that represents a multiple of roughly five times invested capital, Derr Gilbert said.
FTV touts its global partner network, comprised of roughly 500 executives from firms including MasterCard Inc., JPMorgan Chase & Co., Barclays Plc and Ally Financial Inc. as one way it provides value to its portfolio companies. “Warm” introductions between its portfolio companies and network have generated over 500 commercial contracts, which can accelerate their growth, Derr Gilbert said.
The firm counts public pensions such as Texas Municipal Retirement Systems, sovereign wealth funds and family offices among backers of its latest fund.
Its prior funds, FTV VI and FTV V, posted net internal rates of return of about 56% and 49% respectively as of Dec. 31, according to a person with knowledge of the matter. An FTV representative declined to comment on return data.
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