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Back to blog October 06, 2020 No Comments Author: Andy Jones

Private Equity Investment in Cloud Computing

Before the era of personal computers, companies used “Mainframes” for large centralized computing. In the 1970s and ’80s, individual users could access the Mainframe from the terminal on their desk. The rise of the personal computer placed the computing power and storage on our desks. Hence, the term “desktop computer”.

In a sense, cloud computing is a return to the Mainframe style of computing. That is, accessing remote resources (servers, databases, digital storage capacity, software, etc.) over the internet through the terminal of our personal computers.

By sharing large pools of resources, cloud computing offers advantages of reduced cost, increased scalability, massive computing power, and greater reliability.

Cloud computing also enables flexibility with remote work practices, a common theme in 2020. This general transition to cloud computing coupled with the accelerated shift to remote work has created a surge in the already-growing, global cloud computing industry.

While there are many private equity investments in companies that offer cloud-based, SaaS solutions, surprisingly, we do not see many recent private equity investments in the pure cloud computing space.

5 Private Equity Firms with Focused Investments in Cloud Computing Services

  1. Sunstone Partners (San Mateo, CA)
  2. ParkSouth Ventures (Charlotte, NC)
  3. Veritas Capital (New York, NY)
  4. Sorenson Capital (Lehi, UT)
  5. Global Environment Fund (Bethesda, MD)

Sample Private Equity Investments in Cloud Computing

Med Tech Solutions (Valencia, CA)

May 2020Sunstone Partners invested in Med Tech Solutions.

Med Tech Solutions is a healthcare cloud computing company that works exclusively with payers and providers to provide simple and cost-effective HIT and cloud solutions.

 

Enterprise Computing Services (Shreveport, LA)

January 2020 – ECS entered into a strategic investment partnership with ParkSouth Ventures and Kian Capital Partners to support its growth strategy.

ECS is a managed service provider for IT services to small and mid-sized businesses. ECS offers a broad set of services including managed IT, hosted cloud services, disaster recovery, virtual CIO, and security services.

 

Paperspace (Brooklyn, NY)

October 2018 – Paperspace secured a $13 million Series A funding round was led by Battery Ventures with participation from SineWave Ventures, Intel Capital, and Sorenson Capital.

Paperspace is a cloud computing and ML development platform for building, training, and deploying machine learning models.

 

Perspecta (Chantilly, VA)

June 2018Veritas Capital acquired a minority equity interest in Perspecta, owns 14.5 percent of the stock in Perspecta.

Perspecta, Inc. (NYSE: PRSP) provides a diverse set of capabilities covering cyber, big data analytics, cloud computing, enterprise IT, systems engineering, and background investigation services.

 

OPTIMOZ (Bethesda, MD)

May 2018 – Digital Transformation Company, OPTIMOZ raises $2M in Series A round led by the Global Environment Fund.

OPTIMOZ is a digital transformation company that enables enterprises and federal agencies to accelerate the development and delivery of applications. OPTIMOZ specializes in all aspects of cloud computing, bringing reductions in energy consumption and lighter environmental footprint for enterprises and agencies.

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