Livingbridge buys majority stake in VC-backed Semafone

The deal will also provide liquidity for existing shareholders, according to a statement.

The exit generated returns of 6.4x money and a 32% IRR for BGF, the GP said in a separate statement, adding that the firm has now made 12 exits in 2021.

Livingbridge's investment is intended to support Semafone's US expansion plans, as well as investing in product development and the expansion of its team.

Livingbridge is investing in Semafone via Livingbridge 7. The firm reached the £1.2bn mark for its latest vehicle in May 2021, as reported. Like its predecessor vehicles, the fund targets SMEs, but it can also invest equity tickets of up to £150m in businesses with enterprise values of up to £300m.

The fund made its first investment in January 2021, supporting the merger of Australia-based GP practices Better Medical and SmartClinics.

Previous funding
Octopus Ventures invested £1.9m in Semafone in 2010. The company's existing backers then provided a further £1.5m in 2012.

In October 2014, Semafone raised a £5m round, with BGF providing £4m, and Octopus and the company's existing backers providing the remaining £1m. The company had a turnover of around £5m at the time of the round and employed 38 staff, according to Unquote Data. The investment assisted the company with the expansion of its product portfolio and geographical presence, as well as with the delivery of contracts and the provision of additional resources for senior management, BGF said in a statement.

Company
Founded in 2009 and headquartered in Guilford, Semafone develops data security and compliance software for use by companies in communications with their customers, serving businesses in 25 countries. The software covers channels including telephone, social media, webchat and email, allowing companies to automate processes relating to consumer data protection, regulatory compliance and security. Semafone employs 90 people in Europe, the US and Australia.

According to its latest publicly available accounts, the company posted 2020 revenues of £17m, compared with £15.1m in 2019.

People
Livingbridge – Curt Kahn (head of US).
Semafone – Gary Barnett (CEO).
BGF – William Gresty (investor).

Advisers
Equity – Alantra (corporate finance); Pinsent Masons (legal).
Company – DC Advisory (corporate finance); Eversheds Sutherland (legal).

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• Buyouts
• UK / Ireland
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• Livingbridge
• BGF (Business Growth Fund)
• Octopus Ventures