Dive Brief:
- The Carlyle Group made a private equity investment in technology advisory firm Bridgepointe Technologies, the companies said Thursday in an announcement.
- Charlesbank Capital Partners, which first partnered with Bridgepointe in 2022, led the round and will work with Carlyle subsidiary Carlyle AlpInvest going forward. Bridgepointe’s executive leadership team and board of directors will remain in place.
- “This transaction provides liquidity to our early investors while positioning Bridgepointe for its next chapter alongside a new long-term partner,” Charlesbank Managing Director Ryan Carroll said. “We believe the additional capital and partnership with AlpInvest will further support the company’s continued expansion.”
Dive Insight:
Middle-market PE firms first descended on the TA and tech services distributor market five years ago, but a bigger fish has entered the picture. The Carlyle Group is a global firm managing $477 billion in assets.
“We think it's a landmark moment,” Bridgepointe Chief Strategy Officer Scott Kinka told Channel Dive. “The discussion about whether this space is legitimized is over.”
Bridgepointe estimated last year that TAs and TSDs — two models the company spans — are driving about $30 billion in annual vendor billings annually, with a total addressable market of $316 billion. Bridgepointe CEO and Co-founder Scott Evars credited a variety of industry tailwinds.
“We’re in a growing space,” Evars said. “The technologies that we sell are growing. Customers are leaning more into our channel. And that's broadly because of the investments we've made at Bridgepointe, but that our peers have made as well.”
A healthy indicator for the market is Charlesbank’s decision to re-up with Bridgepointe, just as Avant investor Pamlico Capital did with Avant late last year.
Charlesbank’s funding helped Bridgepointe develop into one of the largest technology advisor firms, evidenced by its valuation of more than $1 billion. The company used the 2022 investment to acquire new practice areas, construct a digital platform and retain its branded agents with equity deals.
In a market where TSDs have struggled to develop exclusive relationships with TAs, Bridgepointe has used M&A and equity investments to expand its base of motivated, Bridgepointe-branded sellers.
“This is one of, in some instances, many liquidity events,” Bridgepointe CRO and Co-founder Brian Miller said. “Everybody has the opportunity if they want to make money in this transaction.”
The firm is eying expansion into markets where it currently lacks IT strategists, as well as continued acquisition of enterprise clients. Bridgepointe has won logos from the likes of ESPN, Dunkin Donuts and AirBnB, breaking new ground in the TA’s industry.
“When you're in the Fortune 50, you're not supplanting another agent. You're supplanting a services company. You're supplanting a large consulting company,” Kinka said.
