Matrix, Foresight make 32x return on software spin-out

UK-based Matrix and alternative asset manager Foresight Group have generated a 32x return on their investment in software company App-DNA, which was spun-out from one of its other portfolio companies.

Matrix Private Equity Partners and Foresight Group have sold software company App-DNA to Citrix Systems in a deal valued at $92 million, according to statements.

At the point of entry in 2003, Foresight Group managed part of Matrix's Income and Growth VCT fund, and invested capital from both Matrix's fund and its own Foresight VCT. 

Matrix’s total proceeds will be £16.4 million (€18.8 million; $26.2 million), from the £500,000 it invested in the business. Foresight invested £771,000 from its fund, with both firms gaining a 32x return on their investment.

App-DNA develops software that allows users to change operating systems quickly and cost-effectively. App-DNA was originally the in-house operating system for applications provider Camwood Enterprises. 

The firms developed the software from an operating system into a business that could offer the system as a service to other companies and is demonstrative of the UK’s potential in the technology sector, according to Guy Blackburn, a Matrix investment manager who served as a  non-executive director of App-DNA.

Blackburn said in a statement: “App-DNA is a great commercial success for the UK technology sector. The UK continues to be the birthplace of highly innovative, fast growing and internationally successful businesses.”  

Matrix’s investment was made from the Income and Growth VCT fund, which is £42 million in size. The firm's total assets are spread over four funds, which have a combined size of £135 million. The firm has £35 million left to be deployed in total, according to a source close to the deal. 

This is Matrix’s second exit so far this year, and the firm has also made three new or follow-on investments. On Monday, Matrix invested in Equip Outdoor Technologies to finance the company’s acquisition of outdoor clothing business Lowe Alpine.