Private Equity firm Cinven Acquires Objectway
- Kendrick Wakeman, CFA
- 12 hours ago
- 2 min read
Objectway, a global end-to-end WealthTech platform based in Italy, has sold a majority stake to private equity firm Cinven. This is probably the first pure WealthTech we have seen Cinven dive into and it appears to be a platform investment for them. They do have some WealthTech and adjacent exposure, mainly:
Alter Domus, a tech-enabled fund administrator for Private Equity, Real Assets, and Private Credit. With over $2 trillion in AUA, there could be some interesting synergies here.
IFGL, an insurance and investment advisor for internationally mobile folks.
Säkra, one of the largest insurance companies in Sweden. Could be a new Objectway deployment, if it isn't already.
True Potential, a tech-enabled advice provider, this one is pretty solid WealthTech. We will be watching to see if any synergies develop out of this.
We have seen a marked pick-up in interest in WealthTech from the private equity community over the last two years. Everyone seems to be looking, but it is difficult for them to find an initial investment because, to get involved in a new sector, they need to make a platform purchase large enough to be worth their while, and there aren't all that many of those. They continue to be active on the tuck-in acquisition front once they have a platform to bolt onto. For example, the last two companies we have sold have been to private equity as tuck-in acquisitions.
WealthTech isn't necessarily what we would think of for private equity, who usually like strong cash-flow situations where growth is sometimes secondary to debt magic and financial structuring. We suspect that their strong involvement in the RIA roll-up market has shown them first hand how important the technology piece is to that business and how a targeted bolt-on acquisition program can add value and scale. Overall, we see it as a healthy development for the market.