Bregal Sagemount bets on government software

The $500m vehicle led by Gene Yoon has invested in eight companies since it was founded last year.

Bregal Sagemount has invested $40 million in government agency software company Accela, according to a statement. 

Accela uses cloud computing technology to help local, state and larger municipalities automate software used to issue permits and licenses. The company has a presence in enterprise agencies in New York City, San Francisco, Melbourne, Australia and the Emirate of Abu Dhabi. Smaller jurisdictions include Westminster, Colorado and Nogales, Arizona, according to the statement.

“We think there is a very large opportunity to develop and sell a product that will address the 1,600 municipalities that are smaller and don’t have a budget to afford a large back-office software,” Bregal Sagemount partner Daniel Kim told Private Equity International. These municipalities range in size but have the same needs—an affordable in-house software infrastructure, Kim added.

Bregal Sagemount invests a $500 million fund for growth-oriented investments that looks at both control and non-control investments in equity and debt—so far it has invested in eight companies. The fund will invest between $15 million and $75 million in companies, and can invest as much as $150 million in partnerships with Bregal Investments. Most of the companies are broadly in the software and technology sectors, though the firm is flexible when it comes to new investments, according to Kim. 

Bregal Investments, the investing practise of the billionaire Brenninkmeijer family began as a global fund of funds in 2002 and later acquired UK mid-market firm Englefield Capital. Today Bregal Capital includes Englefield and invests in Europe and Bregal Partners, which came out of Centre Partners, invests in the US. 

Bregal Sagemount launched in June 2012 with five investment professionals, led by Gene Yoon, the former head of private equity for Goldman Sachs’ Americas special situations group. The Bregal Sagemount team has since grown to 10 individuals.

Magazine subscribers can read an in-depth feature story on Bregal Partners in the October issue of Private Equity International.