SSM Partners was founded in 1973 as a consulting firm working
with family owned businesses on how to grow their company including
acquisitions, growth strategies, and exits.
In the 1990s it transitioned into a direct investment firm with the same
consultative, partnership approach. Many
of our investors then are still with us today.
Today we are investing out of our sixth fund. We focus on a growth equity strategy and invest
nationally but focus on the Southeast, Midwest, and Texas . We partner with the entrepreneur and the
management team to realize their full potential down the road through an exit.
Who is in your sweet
spot?
We invest in businesses with $5M in revenue and up. The
first category is software and technology, particularly recurring revenue B2B
software businesses, which fits well with our Austin experience. We spend about 1/3 of our time in healthcare
IT and also healthcare services. Finally, we look at internet and e-commerce
businesses as well.
We’re looking for a proven product/service with a lot of
customers who love it. In many cases they are increasing their spend on the
product. The proof it works is
there. They often have a unique
differentiator that gives them a leg up.
Where do you invest in
healthcare?
We focus on healthcare IT and services and have strong experience
in the revenue cycle technologies. We’ve
taken a hard look at telemedicine and patient pay solutions as well. We do not
invest in therapeutics or devices.
So what kind of check
size do you write?
Typically, our check size ranges from $5M to $15M. We’ve done some north of that range where we
partner on the funding.
What stage do you
invest in?
We invest in businesses with $5M in revenue and up. A good number of our investments were
bootstrapped and have not yet raised an institutional round though could have
as the entrepreneur has built up a $5M to $10M revenue per year company. We also invest in the more traditional path
where the company has raised an institutional round and now they are looking to
expand further and need another round of capital to grow.
How do you handle syndication?
In the last ten years, we’ve co-invested in about half of
our deals. In syndication we want to make sure management and other investors
are aligned especially on the company strategy, risk profile, and target
exit. Specific to SSM as part of a
syndicate, we want a meaningful voice and impact in the company and so we’re
typically leading or co-leading it with another firm; we don’t want to be $5M
of a $75M round. We’ll most often have a
board seat and are active at the board level.
What Texas companies
have you invested in?
Texas represents approximately half of SSM’s investing
activity over our 20+ year investing history, about 14 of which are in
Austin. Dating back to the 90s, we were
investors in 360Commerce, Dazel, Motive, and others; the three most recent
Austin investments we made were All Web Leads, Bulldog Solutions, and New Era
Portfolio.
What did you think of
Austin?
