Private equity firm Five V Capital’s brand new buyout fund is off and racing.
The Sydney-based firm, which ruled off a $350 million fundraising for its third fund earlier this year, has wasted little time putting the fresh capital to work.
Street Talk can reveal Five V has acquired funds ratings agency and research house Zenith Investment Partners, marking both its maiden foray into financial services and first deal out of Fund III.
It is understood the investment is all about capitalising on growth in the managed funds industry, where funds under management has risen around 11 percent annually for the past 30 years to now sit at $3.786billion, according to the Australian Bureau of Statistics.
Zenith, which has been around for almost two decades, is a way for Five V to tap into that growing market by buying a business that services the financial advisers that manage people’s money.
While the price paid for Zenith was not disclosed, Five V tends to write equity cheques in the $30 million to $60 million ballpark.
It is understood multinational law firm Clifford Chance advised Five V on the transaction, which was finalised last week.
Zenith’s main business is partnering with financial advice practices to provide them with research that they can then use to guide their clients.
The business rates more than 700 investment products and works with more than 140 financial practice clients across Australia. It also provides services such as helping advisers with their compliance structure and providing advisers with bespoke portfolios as either paper-based models or managed accounts.
The company was founded by David Wright and David Smythe in 2002.
Five V was an early backer of Australian tech unicorn Canva, but has about a dozen investments across its two other funds.
Other portfolio companies include health software business UHG, peer-to-peer lender RateSetter, education software company Education Perfect, payroll business Ascender and business process outsourcing company Probe Group.
Five V was set up by former CVC Capital dealmaker Adrian MacKenzie in 2013 and saw another ex-CVC private equiteer Srdjan Dangubic join as a partner in 2016.
The firm typically focus on investing in businesses with an enterprise value between$20million and$200million, where the firm can snare a ‘‘significant ownership’’ position alongside partners.
Across the three funds, Five V has more than $500 million in total assets under management.
KPMG announced it has advised leading Australian retailer, Universal Store (www.universalstore.com.au) on its sale to a group of private equity investors, alongside its existing management team, led by Alice Barbery.
The acquisition was led by Five V Capital, Catalyst Direct Capital Management and BBRC Worldwide.
Peter Turner, KPMG’s National Head of M&A said; “In the midst of many challenging stories in the retail sector, Universal Store is a shining light. This outcome is a credit to a strong group of management and shareholders who have collectively developed a market leading business. They have been a pleasure to work with.”
Universal Store was founded in 1999 by brothers Greg and Michael Josephson, when the first store was established at Carindale, Brisbane. Today the business is a national retailer with 53 stores in six states, a growing online store and turnover in excess of $100 million.
Universal Store’s clearly defined strategy, proven leadership team, and the way it has focused on customers and embraced technology are key reasons the Consortium purchased the Company.
Alice Barbery, Universal Store’s CEO said she was delighted that KPMG had helped them find partners who have deep experience in the sector and a supportive approach for the continued growth of the business. “We think it’s a great outcome for our business, and positions us well for further growth”; she said.
Alice acknowledged the contribution of her team to the success of the business over recent years. “Our people are the biggest reason for our success, and they remain key to our future”; she said. “We’ve built an exceptional team and in turn we have strong relationships with our key brands and landlords. We have also enjoyed committed and consistent support from our founders and major shareholders over many years, and are deeply appreciative of the Josephson family” she added.
“Looking forward, our strategy remains simple but effective. We are focused on delighting our customers, and further expanding our store network and omni-channel offering to meet their needs. This strategy has delivered us outstanding results over recent years, so our focus is on evolving that strategy, rather than changing it.”
The transaction is expected to complete by the end of October.
The peer-to-peer lender has passed AUS$250m in loans.
RateSetter’s Australian arm continues to cement a strong market position down under. The platform has now passed AUS$250m in loans, with more than 10,000 investors registered.
Australian business process outsourcing (BPO) provider Probe Group today announced, that in partnership with funds advised by Five V Capital, it has entered into an agreement to acquire Salmat’s Contact Business. The transaction will create a market-leading, privately owned Australasian BPO provider with an unparalleled service capability.
The combined business, operating as Probe Group, will employ over 3,500 staff, servicing blue-chip corporate and government clients across Australia, New Zealand and the Philippines.
At completion of the acquisition, Probe Group will continue under the leadership of Executive Chairman Rodney Kagan, who will oversee the same senior executive management led by CEO, Andrew Hume and COO, Jarrod Kagan. Combined, this team has over 100 years of industry experience.
Under the terms of the agreement, completion is scheduled to occur on 30 April 2018 subject to satisfaction of customary conditions precedent.
Probe was founded by Mr. Kagan in 1979, and over its 39-year history has grown into a leading full-service BPO provider, servicing many of Australia’s leading companies.
Mr. Kagan said Probe Group will benefit from additional capital and resources to continue to invest in delivering industry-leading services and solutions to its customers.
Mr. Kagan said, “I am very, very excited to announce that Probe has acquired Salmat’s Contact Business, which is one of the leading operators of contact centres in Australia, New Zealand and the Philippines. We have combined our market leading capability and management with an established Australasian contact centre platform. This positions us to continue to benefit from ongoing outsourcing trends and to continue to deliver the highest level of service to our clients. Five V Capital’s network, strategic involvement and capital will allow us to lead industry growth and consolidation for a long time to come.”
With deep embedded expertise and standing in the outsourced credit and collections market, Probe embarked on a strategy to build and complement its existing business, which Mr. Kagan described was “a unique opportunity to leverage our operating model and expand our offering.”
Mr Hume said “Salmat’s Contact Business is led by a highly capable and experienced team, whom we look forward to welcoming into our family. Organic growth is strong across the company and that will remain a focus, however, we will continue to look for opportunities to benefit from industry consolidation.”
“Over the last three years, Probe Group has realised significant goals, underpinned by its Next Generation BPO strategy, which has included major investments in new buildings, both in Australia and in the Philippines, technology, data and analytics and people. This has enabled Probe Group to create more than 1,000 new jobs during this period, an achievement of which we are immensely proud,” Mr. Hume added.
“We will continue investing, growing, evolving our capabilities and methodologies and expanding our service offering – making us bigger, better and delivering new opportunities for our people, our clients and partners. Helping us to realise our vision of becoming the most sought after and respected provider wherever we maintain a presence.”
Probe was advised by Intrinsic Partners, Arnold Bloch Leibler and Schoenfeld Consulting; Five V was advised by EY and Gilbert + Tobin
About Probe Group
Probe Group is an Australian-owned business process outsourcing service provider. Probe manages interactions with its client’s customers to generate sales, manage orders, and perform customer service, retention and collections activities as well as associated back-office process management. Probe provides these services to clients across business sectors including Government, Transport and Logistics, Utilities, Telecommunications, Banking and Financial Services, among others. Services are provided from operating sites in Melbourne, Sydney, New Zealand and the Philippines. Further details regarding Probe Group are available on its website: https://probegroup.com.au/.
About Five V Capital
Five V Capital is an Australian fund manager based in Sydney which invests in businesses with organic, consolidation or international growth opportunities. Five V supports these businesses to build sustainable leading positions in their markets. Five V is an investor in companies like Ascender, a Sydney-based BPO payroll provider which employs over 800 staff across Australia and Asia Pacific; as well as Unified Healthcare Group, RateSetter Australia, Education Perfect, Madman Entertainment and Canva. Further details regarding Five V are available on its website: http://www.fivevcapital.com/.
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Canva raises US$40M round, valuing the company at US$1B
Now available in all operating systems across 190 countries, Canva shows no signs of slowing down as they launch in their 100th language
More than 13 designs created on Canva every second
Online design and publishing platform Canva is the latest startup unicorn from Australia, with a new valuation of US$1 billion after having raised a US$40 million round.
Melanie Perkins, CEO and Co-founder at Canva said that while the company is profitable with investments from previous rounds remaining untouched, they decided to take on additional capital to pursue exciting global opportunities and rapidly advance its core product offering. In this round Sequoia China has joined forces with long-time Canva investors, Blackbird Ventures and Felicis Ventures, in backing the design company with a new round of investment.
Melanie adds, “We’ve only just started to scratch the surface of achieving our goal of empowering everyone to design anything, and publish anywhere.
“Design is no longer a niche requirement – every single profession today needs design to help communicate their message. In years gone by someone in sales could draft a letter but now has to create an engaging presentation to win customers. Non-profits have to create designs to spread their message to fundraise. Even the startup staple of business plans have been replaced by graphic pitch decks.
“The world is rapidly becoming more visual, yet traditional design tools in the market are too complicated to use, or so costly that they become inaccessible. Canva is designed to enable individual and teams to collaborate seamlessly, and our growing footprint is evidence of the widespread need that we are addressing. This additional funding will bring us one step closer to giving everyone the ability to thrive in an increasingly visual environment.”
This announcement follows several new product launches this year from the 250 person-startup headquartered in Sydney, including the platform’s availability in 100 languages, a Canva for Android app, as well as rolling out Canva Print in the US, Europe and Australia, with Mexico recently made available. Canva also supports over 17,000 non-profits around the world with free access to its premium product.
Rick Baker, Partner at Blackbird Ventures, who led the investment round, added, “Canva is making huge strides in democratizing design for everyone. Its product growth and adoption across many demographics is truly exceptional. In just four years, Melanie Perkins and her team have taken the startup from humble beginnings in Australia, to what has now blossomed into one the fastest growing software businesses of all time. It’s a very exciting space to be in as we start redefining the workplace, and what it means to communicate in the 21st century.”