They have done it again. Summit Partners has announced their latest capital-raising coup d’état of $4.9 billion in total commitments for their tenth growth equity fund. Announced in late 2018, the oversubscribed fund hit its hard cap and closed in early March.
“We are deeply grateful for the longstanding trust and support of our limited partners,” said Peter Chung, Managing Director and Chief Executive Officer of Summit Partners. “With our latest U.S. growth equity fund, our strategy remains focused on serving as the partner of choice for best-in-class growth companies identified through our unique idea generation process and deep sector expertise. We intend to continue serving founders and executives teams with our industry experience and our platform of value enhancement services built specifically to support the needs of growth companies.”
The Summit Partners Growth Equity Fund X will target minority and majority interests in U.S. based growth companies ranging from $75 million to $500 million investments. But Summit isn’t afraid to put their own skin in the game with the company’s own general partners putting $400 million of their own money into ‘X’ which is, incidentally, the single largest investment made to the fund. Known for being selective about the companies to commit to, Summit may look at 20,000 viable options in a year but only choose a dozen or so that have a strong revenue base and have reached profitability.
Despite their discerning judgment, they have had a hand in a number of notable investments over the last three decades. In 2018, they partnered with other firms to purchase Sound Physicians for $2.5 billion – the sixth largest private equity deal in healthcare for that year. In 2013, their newly established credit advisor arm lent Cross-Fit creator Greg Glassman $16.1 million to buy back his ex-wife’s stake in the company.
Based in Boston Massachusetts, the company operates a growth and venture business unit. They currently manage over $19 billion in assets across three key sectors: technology, healthcare and life sciences, and growth products and services. Summit also operate a public equity unit that focuses on investing in high conviction public equity positions. This team works in tandem with private equity and fixed income teams to achieve the best strategic positions in the market. In 2010, Summit established their credit advisor unit to proactively identify attractive, investment opportunities that they could invest in.
The company was founded in 1984 by Stephen Woodsum and Edward Roe Stamps IV. After working together at both TA Associates and First Chicago Investment Corporation, Woodsum and Stamps struck out on their own and founded the firm. Since its inception, the company has invested in over 475 companies around the world.