Luminate extends logistics-software investing with supply-chain SaaS firm Conexiom

  • Sixth deal out of Silver Lake spinout’s $266 mln debut
  • Conexiom offers supply-chain automation SaaS solution
  • CEO: Competition from Amazon driving customer adoption

Luminate Capital Partners’ investment in Conexiom, a supply-chain automation software company, is representative of the firm’s strategy and also something of an expansion, according to Founder and Managing Partner Hollie Haynes.

“Our sweet spot has been enterprise-focused software companies who solve complex user problems,” Haynes told Buyouts.

“All of our [previous] companies are selling into typically the finance department, shared services or operations, where users remove a lot of data, track a lot of things, manage logistics. This is our first deal selling primarily into a customer base that’s distributors and manufacturers, but it’s the same kind of use case that we’re always focused on.”

Based in San Francisco, Luminate has done seven deals since Haynes spun out of Silver Lake Sumeru, including six transactions out of its $266 million debut fund.

Haynes said Luminate will “probably do seven or eight deals total” out of the fund. Terms of the deal for Conexiom were not disclosed, but Haynes said the investment “is right in the range” of the firm’s typical equity check, $30 million to $60 million.

Vancouver-based Conexiom offers an SaaS product that eliminates manual entry of purchase orders, pricing agreements, invoices and the like, ingesting the information electronically.

Asked whether this meant replacing human workers, Haynes said no: “It’s not a headcount-thinning exercise so much as a typing-saving exercise.” Customers of companies using Conexiom still interact with service representatives, she added. “The interaction just isn’t the customer-service rep typing something, and we can do all [that] with 100 percent accuracy.”

Conexiom was introduced to Luminate by advisory Signal Hill, which recently merged with Sagent Advisors to form DCS Advisory. Luminate’s plans for growing the business begin with increasing sales and marketing efforts in Conexiom’s core markets in North America and Europe, then moving into other verticals in those areas.

Brent Halverson, CEO of Conexiom, said Luminate stood out for its experience and understanding: “From a SaaS perspective, we really liked their knowledge of the market.” He said the company feels well-positioned to expand in part because of Amazon’s increasing presence in B2B distribution.

“It’s forced a lot of markets Amazon plays in to up their game and how they deal with their customers.” Given the turnaround that Amazon can offer, if “you’re relying on old manual processes of people doing things, it’s a competitive threat to our core markets today. It’s definitely one of the reasons why it’s become such a mission-critical solution to our customers.”

Action Item: Check out Luminate’s Form ADV here.

Hollie Haynes, founder and managing partner, Luminate Capital Partners