DTCP (Digital Transformation Capital Partners), a Hamburg-based independent investment management firm focused on cloud-based enterprise software, has announced the final close of its DTCP Growth Equity III Fund (GE III or the Fund). Also, the investor has announced an initial closing of its additional B2B early-stage investment fund at a total amount of $450 million.
Despite a challenging market environment, the fundraising efforts have been notably successful, underscoring the strength of the proprietary data-driven investment strategy and DTCP’s compelling value proposition.
The Fund, launched in early 2022, has raised capital from new and existing institutional investors, pension funds, corporations, and family offices, in addition to Deutsche Telekom who served as the anchor investor. The fundraising builds on the strong track record of the predecessor DTCP Growth Equity Funds, GE I and GE II launched in 2015 and 2018 respectively.
Investment strategy
The fund is targeting nearly 15 to 20 equity investments of $20 to $25 million for businesses in the early growth or growth stage, typically as part of a Series B to D or late-stage funding round.
The predecessor growth equity funds GE I and GE II have invested nearly $408 million into 33 enterprise software companies across Europe, Israel, the US, and Asia. 14 of them have been acquired or gone public, including LeanIX, Signavio, Pipedrive, and Auth0.
Portfolio of investments
Already, DTCP’s latest fund has four investments. These include the following companies:
- Cognigy.AI: A German startup specialising in AI-first customer service automation.
- Cohere: A Toronto-based AI startup offering an AI platform for enterprises to rival ChatGPT.
- Quantum Systems: A German specialist in the development, design, and production of advanced AI multi-sensor unmanned aerial systems.
- anecdotes: A company in governance, risk management, and compliance solutions.
One-of-its-kind approach
The investor deploys DTCP Flightpath, a proprietary data-driven software to analyse the financial data of any SaaS company and benchmark it against peers yielding a unique KPI fingerprint for each firm. The tool serves as a guiding compass for founders and CEOs of startups, offering insights into the vitality and future paths of their businesses. It also stands as an objective and measurable guide, facilitating informed internal investment decisions.
DTCP has offices in Hamburg, Frankfurt, London, Luxembourg, San Francisco, and Tel Aviv. Currently, the investor has $2.8 billion in assets under management and has a team of nearly 50.
Thomas Preuss, Managing Partner at DTCP Growth, said: “The successful closing of GE III is a resounding affirmation of our established and proven data-driven and value additive investment approach. At DTCP Growth, our role extends beyond mere investment; we are allies and advocates for talented enterprise SaaS teams. Despite the prevailing market challenges, we have received commitments from institutional investors, pension funds, corporate investors, and family offices. This underscores the growing acknowledgment that the B2B SaaS industry provides a wealth of exceptional entrepreneurial talent.”