Georgian Partners has raised about $715 million (US$550 million) for its fourth growth equity fund, winning a strong vote of confidence from limited partners for the firm’s scaling strategy.
Georgian Partners Growth Fund IV closed this week at its hard cap, the Toronto investor told PE Hub Canada.
The fund, Georgian’s largest to date, secured 47 percent more than its predecessor, which raised about $485 million (US$375 million) in 2016. It brings total capital raised since inception to about $1.9 billion (US$1.5 billion).
Georgian’s Fund IV is one of Canada’s largest private tech partnerships on record, according to Thomson Reuters data.
The firm achieved this by expanding its LP base. New and returning investors are mostly North American endowments, family offices, funds of funds, pension funds and wealthy individuals.
The number and identity of LPs were not disclosed.
As reported by PE Hub Canada in April, Georgian raised the lion’s share of Fund IV’s target earlier this year. At the same time, the firm was executing a plan to extend its North American market reach.
The goal is to take Georgian’s pioneering applied-analytics investment thesis, allied with a focus on applied artificial intelligence, conversational business, and security in software design, into more tech hubs, especially in the United States.
The firm is doing this mostly by adding talent and enhancing its leadership.
As a first step, it recently doubled the size of the general partner team, introducing Partners Tyson Baber, Steve Leightell and Madalin Mihailescu.
Georgian has since been in hiring mode, especially for its impact team.
The team, a key source of the investor’s operational capabilities, lends tools and resources to portfolio companies, helping them respond strategically to new innovative trends.
New hires include Alex Manea, Georgian’s chief security and privacy officer. Manea joined last month from Blackberry, where over 12 years he helped drive improvements to the company’s security posture, most recently as CSO.
Additionally, Amit Thakar came on board in May as director of product. Thakar previously spent 16 years working mostly in senior product management and development roles at U.S. tech companies Centro, Nvidia and Semtech.
Another important staffing move was July’s promotion of Emily Walsh to principal.
Walsh, who joined Georgian in 2016 from McKinsey & Co, works with GPs on the investment team, sourcing business software opportunities, doing deals, and advising companies post-investment.
Toronto-based personnel now total 38, nearly a third of them impact team members.
Pivoting to Fund IV
Going forward Fund IV will be Georgian’s primary vehicle for making new investments.
That’s because Georgian Partners Growth Fund III, which has sustained a heated deal pace over the past two years, wrapped up in June.
The fund’s final investment was major. Georgian led the more than $90 million (US$70 million) Series C financing of Ritual, a Toronto food-ordering app.
Ritual is led by CEO Ray Reddy, whose prior venture, PushLife, was acquired by Google in 2011. Reddy and fellow co-founders designed the four-year old Ritual to connect restaurants with customers through a mobile tool for placing, paying for and picking up meals.
Leightell, Georgian’s point man on the deal, says the company’s workplace focus, which taps into the “ritualistic” social element of food ordering and eating in modern urban offices, explains its recent “viral” growth.
Workplace teams using Ritual increased to 45,000 in 2018 from 1,000 a year earlier, while the number of restaurant partners doubled to 3,000-plus.
Georgian’s impact team is now collaborating with Ritual to further accelerate its application of machine learning, AI and data science, Leightell said.
Other 2018 investments by Fund III include U.S. energy disaggregation tech provider Bidgely and U.S. personalized fashion platform True Fit.
In all, the fund closed 13 investments. That brought companies backed by Georgian over time to 35.
Georgian was founded in 2008 by Managing Partners John Berton, Simon Chong and Justin LaFayette.
Chong, LaFayette and Leightell are former executives of data-integration-software maker DWL and IBM, which acquired DWL in 2005. Baber is also a former IBM executive.
(This story was revised to update Georgian’s total capital raised since inception.)
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