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BV Investment Partners targets $1.5bn for 11th sector-focused fund

Fund XI's hard-cap is $1.75bn, which if reached would make the pool 59% larger than Fund X, closed two years ago at $1.1bn.

BV Investment Partners, the one-time Boston Ventures, is back in the market with its latest flagship offering to invest in tech-enabled business and IT services.

The target for BV Investment Partners Fund XI is $1.5 billion, an Arkansas Teacher Retirement System report said. The hard-cap is $1.75 billion, which if reached would make the pool 59 percent larger than Fund X, closed two years ago at $1.1 billion.

BV is looking to hold a “significant” first closing this month, the ATRS report said.

Private equity fundraising is slowing due to a crowded marketplace, over-allocated LPs and other factors. Some 164 vehicles secured almost $132 billion in the first quarter, down 24 percent from a year earlier, Buyouts’ data showed, reversing a trend of post-pandemic growth.

Fresh challenges – above all, those posed by cash-strapped LPs – could result in longer fundraising timelines or delayed fund launches. Impacts are expected to be felt democratically across the PE industry, affecting even the very largest GPs.

BV was founded in 1983 as Boston Ventures. Rebranded in 2011 after a succession event, it today acquires control and minority stakes in mostly US lower-mid-market companies operating in tech-enabled business services, software and IT services sectors. The firm invests a minimum of $40 million in businesses with EBITDA of $5 million to $20 million, according to its website.

A key aspect of the strategy is its focus on large, diverse sectors with secular growth drivers, high recurring revenue and high cashflow margins, the ATRS report said. In addition, BV targets family and founder-owned businesses where it can be a first institutional source of capital.

Recent funds have been solid performers. BV Investment Partners Fund X was as of December earning a 1.4x gross multiple and a 53.5 percent gross IRR, the ATRS report said. Fund IX was earning a 2.4x gross multiple and a 40.4 percent gross IRR.

BV’s portfolio consists of 29 active investments, according to the website. New deals include a majority investment in specialized tax consultancy Source Advisors, announced in April, and a growth equity investment in digital solutions provider Marlabs, announced in January.

The firm also this month announced an exit. It agreed to sell GlideFast Consulting, a ServiceNow partner and professional services business, to NYSE-listed ASGN. BV invested in GlideFast and its sister company Pharicode in 2020.

BV is led by CEO and managing partner Vikrant Raina. Raina came onboard in 1999 from Goldman Sachs Asia’s communications, media and tech group, where he was an executive director. Before, he worked as a project leader at Boston Consulting Group.

Raina heads a Boston-based team of 19 investment professionals. They include managing partners Justin Harrison and Matt Kinsey, who joined in 1999 and 2000, respectively, from Chase Securities, as well as managing directors Eric Ahlgren, Justin Garrison, Jason Kustka and Sean Wilder.

BV declined to provide a comment on this story.