Silversmith’s Todd MacLean on AI deals; Apollo-backed HarbourView raising new royalties fund

HarbourView Equity, which focuses on royalties investments, unveils first commingled fund targeting $500 million.

Morning Hubsters!

A quick note of thanks for all the recommendations for Women in PE this year. As usual, we received a ton and it’s been a tough process to whittle down the huge list to just 10. We finalized our list and will be making outreach this week. Thanks to everyone for participating!

AI: Todd MacLean, managing partner with Silversmith Capital, spoke with Georgina Tzanetos at PE Hub about the firm’s recent investment in Impel Software, which provides AI-powered customer engagement software for the automotive industry.

“Every investment opportunity we heard about for years had AI sprinkled in there somewhere, but what we learned over time is that there are two parts to making AI effective in a commercial setting,” MacLean said. The first part is the algorithm, or “mousetrap,” as MacLean put it, and the second part is the data that powers the formula.

“At the beginning of the [AI adoption] cycle, I think we saw lots of the former, lots of great tech, but they didn’t have the data to apply it to let it learn,” he explained. “We are now approaching the part of the cycle where companies are now matching their technology to these data sets and producing effective results.”

Impel has been growing – the company more than doubled its revenue over the past two years, exceeding $50 million last year.

Prior to Silversmith’s investment, Impel had already completed two acquisitions and scaled the organization to over 200 global employees. Impel now serves more than 4,000 customers through 100 technology and marketplace partners.

More M&A is in Impel’s future, Silversmith said. Read more here on PE Hub.

Newbie: Speaking of Women in PE, one of last year’s selections, Sherrese Clarke Soares (who appeared on the cover of Buyouts), is in the news today with her new firm.

HarbourView Equity, which focuses on royalties investments, is out with its first commingled fund targeting $500 million. The firm, formed in 2021 by Sherrese Clarke Soares, also has $1 billion in backing from Apollo through a fund-of-one structure. HarbourView focuses on royalties-producing sound recording, music publishing and composition assets.

Fund I will have a six year term and three year investment period, charging a 1.75 percent management fee and 20 percent carried interest rate, according to pension documents. Read more here on Buyouts for the details of the fund.

HarbourView is among a handful of first-timers seeking capital in the tougher fundraising markets this year. Another we reported on recently is Coalesce Capital, formed by ex-Warburg Pincus industrials lead Stephanie Geveda. Coalesce is in market with its debut fund. Check out our extensive coverage of first-timers and emerging managers here on Buyouts.

Deals: We’ve opened the nomination process for our annual Deal of the Year awards. Winners for deals closed in 2022 are chosen in seven categories: Deal of the Year, Large-Market Deal of the Year, Middle-Market Deal of the Year, Small-Market Deal of the Year, Turnaround of the Year, International Deal of the Year, and Secondaries Deal of the Year.

Download a PDF of the Deal of the year 2023 application. Deadline to submit your nominations is Monday, Feb. 13, 2023. Winners are announced in April. Read about past winners here.

The volume of submissions is so high that I likely won’t be able to get to every question that comes in. I urge you to read the application form closely, which lays out all the details necessary to make a submission.

That’s it for me! Have a great rest of your day. Hit me up with tips n’ gossip or feedback at cwitkowsky@buyoutsinsider.com or find me on LinkedIn.