Spire Capital gears up for first close for EUR 110m fund

SCP is in advanced talks with investors to raise money for the vehicle, Konopinski said. It is aiming to secure commitments of around EUR 65m-EUR 70m by the first close, which is expected within the next couple of months, and is looking to raise a total of around EUR 110m altogether, he said.

Fundraising efforts are centred on institutional investors, with a mix of HNWI and entrepreneurs also expected to participate, Konopinski said. Domestic capital will likely represent around 25%-35% of the first fund’s commitments, with the balance coming from foreign investors that are already familiar with the CEE region, as well as investors that specialise in first-time funds, he said. Historically, such funds offered better performance as they tend to be smaller and have a more focused and more manageable portfolio than their more established peers, he said.

SCP is pitching itself as a specialised tech fund that has a private equity risk profile, as it buys growing, cash-flow positive companies, but without the risks typically associated with earlier-stage VC investing, Konopinski said. Its three founding partners, Arek Podziewski, Łukasz Wierdak and himself have an extensive track record in e-commerce, Software-as-a-Service, fintech and online payment services at Polish GP MCI Capital. For now, the SCP team also includes ESG specialist Iain Haggis and an analyst, while another three investment professionals will be joining at the first close, which is to be followed by additional analysts, Konopinski said.

Deal pipeline
Konopinski told Unquote that the firm has made its first investment with the acquisition of a 70% stake in the Polish CRM and contact centre software developer Thulium. However, SCP is yet to decide whether the asset will be part of the first fund or retained as founders’ private investment.

The firm has a very extensive pipeline, having reviewed more than 100 potential targets since it was first set up some 18 months ago, Konopinski said, adding that several have progressed to more advanced stages of negotiations.

SCP aims to build a portfolio of seven to 10 investments over a period of five years, or possibly quicker, he said. It plans to spend deploy EUR 10m-EUR 20m per investment in exchange for majority stakes, he said. Ideally, it will retain the founders with minority stakes, offering them both a liquidity opportunity and a chance to participate in the expansion of their companies into “something much bigger,” he said.

The sponsor is focusing on three main verticals: software; e-commerce, including infrastructure; and broader tech-enabled services, such as providers of cybersecurity, adtech, marketing tech, AI and data science technology, Konopinski said. Capex-heavy targets are not on the radar and the same goes for investment niches that lack sustainable EBITDA or require very specialized, deep knowhow, such as blockchain, quantum computing or biotechnology, he said.

In terms of geographies, SCP will likely deploy up to 80% of its equity in Poland but it is also looking at the Baltic states, Romania and Hungary, Konopinski said. The Czech market, while interesting, is more competitive and thus less likely as a destination, he said.
Instead of being a hindrance, the recent decline in the valuation of tech stocks could help SCP as it may be able to build its portfolio at more attractive valuations, Konopinski said. “This could be a very good vintage for investments in tech,” he said.

The firm is sourcing potential deals primarily through its founders’ personal network and is looking to acquire targets after bilateral discussions although it will participate in selected auctions as well, Konopinski said.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• Funds
• Buyout
• CEE
• Technology
• Poland