DTCP has just announced the first closing of its Growth Equity III Fund at almost €300 million. Initially launched in March 2022, the firm plans to continue raising capital for the Fund with a final close expected in 2023.
Digital Transformation Capital Partners (DTCP), an independent investment firm, is focused on supporting global digital transformation. The firm, since 2015, has been investing in leading cloud-based enterprise application software companies – operating with the belief that digital tech is fueling the future. The company has been supporting bus innovators using tech to disrupt business and bring about transformative new ideas.
In March 2022, the Hamburg-based investors announced the launch of its Growth Equity III Fund (GE III) with capital destined for software companies. Now, the firm announced the first close of the fund at an eye-catching €300 million.
The details
The capital for the fund is coming from new and existing investors including Deutsche Telekom and SoftBank, alongside other institutional, pension fund, corporate, and family office investors.
DTCP plans to continue to raise significant capital for the Fund and aims to close fundraising in 2023.
Investing in disruptive software
Following a proven DTCP’s proprietary data-driven investment strategy, GE III invests in cloud-based enterprise software and business Software-as-a-Service (SaaS) companies in the fields of cybersecurity, web3, AI, fintech, vertical SaaS solutions as well as IT applications and cloud infrastructure software.
The Fund is targeting about 25 equity investments in the range of €20 to €25 million for businesses in early growth or growth stage, typically as part of a Series B-D or late-stage funding round.
While this year has seen many new funds open up, most of them have been focusing on early-stage startups and innovation. To see this leading investment company target growth stage ventures is a positive change and reaffirms commitment to the long term development of these companies – creating an innovation economy that is more sustainable and mature.
DTCP is scattered across the world, with offices in Hamburg, London, Luxembourg, San Francisco, Seoul and Tel Aviv. Reflecting this, the fund will be used for category leaders in the key markets of Europe, the US and Israel.
Jack Young, Managing Partner at DTCP Growth, said: “The current market environment and the recent valuation reset offer unique opportunities to invest in great companies and the category leaders within the enterprise software market. We will be patient and disciplined in deploying the Fund carefully balancing risks and rewards. Using our automated proprietary benchmark system and deep industry knowledge, we can continue to identify leaders in our target markets and help them scale to reach their full potential.”
Building on a strong reputation
This is of course DTCP’s third fund. The predecessor growth equity funds GE I (2015 vintage) and GE II (2018 vintage) have invested about €410 million into 32 enterprise software companies around the world. 11 of these have since been acquired or gone public.
GE III has already made it’s first deal, with a €15 million investment into German startup Conigy.ai as part of its Series B. Cognigy.ai is a conversational AI and automation platform that enables enterprises to communicate effectively and intelligently with customers and employees 24/7 across more than 20 languages on all conversational channels including chatbots, virtual assistants or voice-bots over the phone.
Thomas Preuss, Managing Partner at DTCP Growth, said: “Our GE III fund is the continuation of a proven strategy, and we would like to thank our existing and new investors for their support and trust. With one of the largest specialist teams focusing on cloud-based enterprise software in Europe, we’re excited about the continued opportunity to back outstanding entrepreneurs and category leaders in the fast-growing cloud-based enterprise software ecosystem and to create attractive co-investment opportunities for our investors.”
