Strandview Capital Raises Strategic Growth Fund to Address Major Disruption in Financial Software and Services Sectors

Strandview completes equity investments in six companies

Los Angeles, CA — May 1, 2018 — Investment firm Strandview Capital has raised a specialized fund to provide minority growth equity investments into early stage financial software and services companies. Although this is the first fund as part of Strandview Capital, it is the fourth in a series of funds launched and successfully managed by the Strandview team since 2006.

Strandview Capital currently has $27 million of assets under management. To date, Strandview has invested in the following six companies:

Insellerate: CRM and workflow software for mortgage lenders
Coverance Insurance: Medicare supplement insurance agency
Silvergate Bank: Top U.S. commercial bank serving cryptocurrency industry
Qmerit: Procurement and workforce management software for commercial building industry
Emergent Business Group: Consumer debt collection and distressed loan acquisition
The Closing Exchange: On-demand notary and closing network for financial services industry

“The financial services and financial technology sectors represent a huge market that is currently underserved by traditional venture capital and private equity firms due to the specialization and complexity of our industry,” says Mike Sekits, Managing Director at Strandview Capital. “Also, we target niche companies at a stage that generally falls in between the stages targeted by these traditional investment firms. Many sectors within financial services such as mortgage and insurance are years behind other industries in terms of innovation and technology. As a result, we predict significant opportunities over the next several years for smaller companies within the financial services and financial technology sectors.”

Strandview targets software and technology-enabled services companies focused on markets such as mortgage, insurance, wealth management, distressed asset management and emerging blockchain applications. Strandview typically leads minority equity investments of $2 million to $10 million per company. Although Strandview invests in earlier stage companies, it reduces risk by targeting companies that are recession-resistant, have proven products and pricing, and are able to reach profitability with Strandview’s capital, thereby avoiding continual fundraising and dilution of investors.

“Beyond simply providing capital, we provide much greater strategic value to companies than typical generalist investment firms,” says Kevin Covert, Managing Director at Strandview Capital. “We employ a highly strategic, hands-on, high value-add approach, and often help companies land new customers that generate meaningful revenue.” Strandview’s current LP investor base includes ten founders of financial services companies from three prior funds managed by the Strandview team. These and other strategic LP investors often provide significant value to the companies that Strandview invests in.

Various studies have shown that smaller, specialized, thematic funds typically perform better than larger, generalist funds. In the current market, many investment firms are raising increasingly larger funds and investing at historically high valuations. Strandview plans to manage relatively smaller, specialized funds that incorporate a proven, contrarian, defensive and value-focused strategy. The Strandview team’s deep industry specialization and extensive relationships within financial services generate truly proprietary investment opportunities without the need to participate in term sheet bidding wars or expensive investment banking auction processes.

About Strandview Capital

Strandview Capital provides strategic growth capital to emerging financial software and services companies. Strandview incorporates a unique hands-on strategic approach that leverages its deep industry specialization and relationships to add substantial value to its partner companies. Strandview is typically the lead investor on financing transactions and makes large minority equity investments into companies with proven products, capital-light business models, and a focus on profitability.

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