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Are you raising? Our list of "patient capital" writing big checks

The smart money behind Valsoft, Banyan, Dura - and many others

In the second installment of our fundraising series, we delve into the capital providers supporting the emerging software aggregators, which are intensifying the competition against industry giants Constellation Software and Visma.

The OGs of software rollups

If you’re entrenched in the enterprise software world, the mere mention of Constellation Software likely resonates with awe. Established in 1995 by the legendary Canadian investor Mark Leonard, Constellation has mastered the art of acquiring vertical market software (VMS) businesses. These niche software providers cater to specific markets, offering mission-critical solutions that power entire industries.

With over 600 acquisitions under its belt, Constellation operates like a well-oiled machine. But here’s the twist: rather than being controlled by a central entity, each acquired business is managed independently within distinct operating groups. Names like Volaris, Harris, Jonas, and TSS command their own territories in this sprawling empire (full disclosure: I earned my stripes at Volaris).

With an annual M&A budget ranging between $1 billion and $2 billion, Constellation stands as the undisputed heavyweight in acquiring vertical market enterprise software companies, affectionately known as “VMSaaS” (Vertical Market Software as a Service).

Across the Atlantic, Constellation finds a worthy European counterpart in Visma. Founded in Norway in 1996, Visma boasts backing from heavyweights like Hg Capital, GIC, TPG, ICG, and General Atlantic. Fun fact: Visma’s origins can be traced back to Spectec, a software provider for the global marine industry. In a serendipitous turn, Spectec joined forces with Volaris in 2012 to establish its Marine Division, completing a full circle of evolution.

The seeds sown by Mark Leonard nearly three decades ago have blossomed into an industry of immense proportions, with numerous consolidators vying for dominance. In the following profiles, we shed light on some of the notable players in this ever-expanding landscape.

The primer

Here we categorize the software consolidators based on the type of capital backing those:

  • Private equity “captive aggregators”

  • Growth equity into sector plays

  • PE and search funds looking to go downmarket

  • “Patient capital” providers

In a way, all four categories can be considered patient capital given the time required to build up scale and credibility for a platform. 

Category #1: PE “captive aggregators”

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