Robert Smith’s Vista Equity Partners more than quadrupled its initial investment in Apptio Inc. after International Business Machines Corp. decided to buy the software manufacturer for $4.6 billion.
Investors were informed by the private equity firm that Apptio would generate 2.1 times its investment after fees when it acquired the company in early 2019 for around $1.9 billion. Since late 2021, Vista has profited on bets to the tune of $18 billion, according to a statement released on Monday.
The agreement provides Smith more ammo as he searches the world for ways to generate $20 billion for new business partnerships. According to the Bloomberg Billionaires Index, he is now the 152nd richest person in the world with a net worth of roughly $12 billion.
Smith is attempting to convince pension funds and investors that the business has moved past the billionaire’s admission of tax cheating after he paid $139 million to defer prosecution until 2020. In order to meet its lofty fundraising objectives, Vista, like other private equity companies, has had to deal with rising interest rates, volatile markets, and concerns about an economic slowdown.
Vista is most known for its large software company acquisitions and its comprehensive playbook for improving them and maximising earnings.
The Austin-based company has completed recapitalizations, block sales, follow-on offers, full and partial exits, including last month’s $4.6 billion sale of software provider Cvent Holding Corp. to Blackstone Inc.
“We are committed to building resilient enterprise software companies, which has proven to be highly attractive to strategic and financial buyers, as well as public markets,” said Smith, 60, in a statement.
In the late 1990s, Smith began his career as an investment banker at Goldman Sachs Group Inc. There, he first met billionaire Robert
Brockman, who later provided funding for the founding of Vista. By 2018, Smith had surpassed Oprah Winfrey in terms of fortune, becoming the richest Black American.