Growth Equity III, an investment fund owned by DTCP, has received €420 million in funding
DTCP has completed fundraising for its Growth Equity III investment fund. It has also secured funding to develop another fund focused on early-stage B2B investments. The total amount raised in the designated rounds is €420 million.
It is worth noting that this fundraising continues the investment company’s string of successful fundraisings. In 2015, DTCP launched the GE I growth equity fund. GE II was the follow-on fund in 2018.
The company provided details of the new fund’s activities:
– focus on 15-20 equity investments;
– investments in projects will range from US$20 to US$25 million;
– plans to back early and later-stage companies;
– funding will most commonly take the form of Series B-D rounds.
The fund is interested in start-ups in artificial intelligence and automation. Demand for such products is growing rapidly, as is investor interest in their developers.
Analysts expect Growth Equity III to be no less successful than its predecessors. In total, it invested around US$408 million in 33 companies. These were companies from the US, Israel, European and Asian countries. Their main area of activity is the development of business software. 14 of the profiled companies have gone public, including one IPO:
– LeanIX;
– Signavio;
– Pipedrive;
– Auth0.
These companies have already returned more than 100% of the invested capital. In addition, they have significantly increased the value of the remaining business assets in the portfolio.
Investment strategy features
The Growth Equity III fund has been in operation since 2022. It raised investments from both existing and new institutional investors, including pension funds, corporates, and family offices. Deutsche Telekom was the anchor investor.
Remarkably, DTCP raised significant funds in a challenging market. The success is primarily due to the company’s strategy, which communicated its benefits to investors. A well-thought-out value proposition that fully reflects the benefits to investors is at the heart of DTCP’s approach.
The firm was one of the first in its sector to implement a quantitative performance-based strategy. The firm uses DTCP’s proprietary technology product, Flightpath. The software analyses the financial information of SaaS representatives and compares it with competing companies. It allows specialists to examine the KPIs of each prospective investor. The tool also models possible development paths and growth probabilities for start-ups. This will enable managers to understand the business’s potential better and determine its development direction.