Fintech e4 acquired by consortium led by Infinite Partners
Leading South African fintech specialist, e4announced today the purchase of a consortium by private equity investors, led by an independent manager of private equity funds, Infinite Partners. The transaction will see e4 raise the necessary capital to proceed to the next stage of expansion.
e4 is a forward-looking technology company that delivers customized, innovative solutions and services, including software development and business automation. Focusing on software as a service (SaaS), e4 leverages its technological expertise to completely transform customer processes, positioning itself as a pioneer in digitization in South Africa. For over 20 years, e4 has built on its strong foundation as a leading digital transformation specialistwith digital enablement as a core element of its ethos.
The e4 the management team brings a wealth of experience in value creation software development, consistently driving successful diversification across industries and adjacent geographies. By repurposing its early technology, e4 has developed innovative solutions that meet the needs of various sectors, with a notable presence within the proptech space. As a result, e4 has become a central figure in a number of transactional ecosystems. The wider e4 Group employs over 200 dedicated professionals and in 2021 launched a new group in the UK with a focus on construction e4‘s relationship with mortgage lenders, brokerage firms and others partners in Great Britain.
This strategic acquisition of Infinite Partners gives e4 with the necessary resources and support to further expand its reach and continue its mission to transform businesses through cutting-edge digital solutions. The transaction includes 27four, a diversified financial services group that invests money innovatively and supports independent asset managers.
Infinite Partners is an African manager of private equity funds, established in 2022 after spin-off from Ethos Private Equity. Founded on a bedrock of ethical sustainable investing for good, Infinite Partners is both value- and value-driven partnersseeking growth investments together with visionary management teams.
In line with an investment strategy centered on companies benefiting from digitization and technology adoption, tailwinds, Infinite Partners‘ interest in e4 is a result of the company’s demonstrated track record of being at the forefront of key process digitization both in South Africa and in the UK market.
Commenting on the rationale behind the transaction, Edward Pitsi, Infinite Partners CEOnotes, “e4‘s strongest growth potential lies in continuing to do what it does very well and thereby increasing the penetration of its current products and following its well-established “blueprint adoption” with its customers. We are very excited about the growth opportunities for e4 to grow into other adjacent areas while retaining a strong market position in the current verticals it serves. Finally, the business has recently expanded into the UK which has a TAM that exceeds 10x the SA market – we will support management through this expansion as it can have a material impact on bottom line results. Our experience in managing growth agendas, providing strategic input and growth capital will be fundamental to support delivery on the opportunity set.”
He adds that the strength of e4management was central in Infinite Partners‘ decision to invest in the business. “From our first engagement we were impressed e4its management team that has been fully professionalized with key positions held by people who have experience but are still hungry to grow the business and take it to greater heights. We can’t wait to see e4management utilizes its experience, knowledge and customer relationships to spearhead strategic growth. As an investment partnerswe will look to be supportive, yet challenging to achieve the right results together with management.”
Naomi Nethengwe, Infinite Partners Headmaster agree, “With its proptech offering, e4 operates within digital & tech, a sector which Infinite Partners have identified as having a structural growth potential. Proptech is a niche segment of the economy and it has taken a significant amount of time and investment to build this world-class technology stack. We envision a significant runway for international expansion due to the exportability and global relevance of e4its technology stack. There are also concrete opportunities to expand to other industries that want to reduce friction in document generation, administration and storage processes.”
Chad Potter, CEO and Principal of Private Markets at 27four says, “e4The SaaS business model is in line with their investment strategy of focusing on mid-market companies with potential for growth and social impact. The investment will support e4 in diversifying the SaaS offering, expanding globally and improving the B-BBEE credentials.” He also notes e4its highly defensive and resistant nature and sees the depth and experience of the management team as key strengths to drive innovation, as well as to form and leverage existing customer relationships.
e4 CEO, Grant Phillips, says that the investment is a natural fit for e4its broader strategy. “The e4 Group has been on a successful journey of sustainable growth and expansion in recent years. This has meant expanding our relationships and value creation with our local strategy partners as well as a focus on income diversification and geographical expansion. With some of these initiatives in their infancy, the timing of this new partnership comes at an opportune time for the business. All consortium is aligned with the organization’s strategy, supports the team tasked with executing it and has already begun providing input on additional opportunities that we have jointly identified.”
Phillips says that consortiumits diversified portfolio mix and investor profile provide an exciting opportunity to release synergies, target strategic relationships and partners more effectively within the share pool. “Along with these asset-based capabilities, the company also sees tremendous value in leveraging the long-standing organizational expertise and experience in consortium to improve how we continue our growth trajectory in a sustainable, exponential manner.”
