There are a number of private equity firms that are looking to capture gains in the marketplace. However, one Palo Alto firm is making waves with multiple billion dollar funds and dozens of start-up investments. That firm, HGGC, is currently one of the hottest private equity companies in the country.
The firm HGGC is known as a mid-market private equity group. That means that the company invests between $25 million to $125 million per company. Currently, the firm has a number of technology focused companies in their portfolio. These companies include AutoAlert, RPX, HelpSystems, Serena, Denodo, FPX, Dealer-FX and My WebGrocer.
The firm has raised almost $4 billion dollars through three funds. The first fund, known simply as “Fund 1” has raised around $1.1 billion. The second fund, known as “Fund 2” has around $1.3 billion dollars in capital. And finally, “Fund 3” has about $1.8 billion dollars in capital. Some of the more notable investors include a number of pension funds and insurance companies. These investors include The California Public Employees’ Retirement System (CalPERS), Pennsylvania Public School Employees’ Retirement System (PSERS), West Yorkshire Pension Fund, CNP Assurances and Brederode SA.
The secret to HGGC’s success is that they seek to invest in mid-market companies that are looking to disrupt large companies using traditional business models. For instance, My WebGrocer is seeking to disrupt the grocery industry while AutoAlert is seeking to disrupt the automotive industry. This unique strategy has helped the firm win industry recognition including the prestigious 2014 M&A Mid-Market Private Equity Firm of the Year Award by Mergers & Acquisitions magazine.
The $4.3 billion dollar private quietly firm was founded in 2007. In its 11 years, HGGC has committed an aggregate transition volume of over $12 billion dollars. The company current has 60 companies in its portfolio employing over 43,000 full-time staff. Key personal include Gregory M. Benson, Richard F. Lawson, Jr., Leslie M. Brown, Jr., Neil H. White, and 3-time Super Bowl winning quarterback Steven Young. As the firm enters its next decade of operation, HGGC will seek to further innovate the world of private equity.