Small- and medium-sized businesses are expected to spend $96B on cloud-based systems by 2022. Cloud Equity Group empowers its investors to capitalize on the rapidly expanding world of web hosting and cloud-based infrastructure by providing two investment vehicles.
Private equity allows investors to maximize their return through direct ownership of a fund’s portfolio companies on a Limited Partner basis. Investors take advantage of the lucrative returns of owning a large portfolio of successful private market businesses while avoiding the hassles of managing day to day operations. Proper valuation and implementation provides investors opportunity for significant returns upon liquidation.
With the tremendous liquidity in the tech-enabled business service providers sector, Cloud Equity Group prides itself on its ability to quickly and correctly value investment opportunity and its management team. In addition, portfolio targets present high levels of synergies and economies of scale providing attractive growth opportunities upon portfolio integration. Typical private equity investments are longer term with a target of 4-6 years.
Senior and mezzanine debt investments enable investors to capitalize on the world of private market investments via the purchasing of senior notes and junior debt in portfolio companies . In return, investors receive highly attractive returns by way of cash and payable in kind interest. In addition to receiving significantly higher than market interest rates, investors typically participate in the growth and upside of the companies via exercisable warrants. Investors also receive a level of seniority over that of typical equity holders.
Our senior and mezzanine debt investments complement our equity strategy in the acquisition of private lower middle market companies through optimization of the ideal capital structure. Capital investments by investors are typically utilized via portfolio acquisitions, funding expansion, or as an alternative exit strategy for equity holders. Investment timeframe in senior debt and mezzanine funds range from 3-5 years.
(Note: Cloud Equity Group does not typically invest in startups or provide seed capital)