Venture

Riverwood Capital closes $1.8B fund, says opportunity in LatAm ‘has never been greater’

Comment

dollar bill tornado
Image Credits: Bryce Durbin / TechCrunch

Riverwood Capital has closed on $1.8 billion in new capital, the growth investment firm announced today.

The firm last raised in 2020, with total capital commitments of $1.4 billion at that time.

Riverwood’s strategy is to invest in and support “high-growth” mid-size technology companies that are either profitable or with positive unit economics. The new capital will go mostly toward new investments, said Jeff Parks, co-founder & managing partner of Riverwood Capital. The firm does not reserve capital upfront in a fund for follow-ons.

However, Riverwood does plan to “selectively” invest more capital over time in its existing portfolio companies “in case there is an opportunity for M&A, to accelerate organic growth, or provide liquidity to some shareholders that might need to sell,” Parks said.

“We consider those options on a case-by-case basis,” he added.

The firm’s check sizes primarily range from $25 million to $100 million per company. Riverwood targets 20 to 30 companies per fund cycle. So far, it has backed a few companies out of its new fund, including SpyCloud, Hyperproof, One Model and Logcomex.

Over the years, Riverwood has made more than 75 investments, and says it has seen over 40 exits (including fully/partially realized and liquid investments) ranging from acquisitions, sponsor buyouts and IPOs, since its 2008 inception. Billtrust, Globant, GoPro, Nextdoor and Vacasa are among the companies that went public. 

Recently, portfolio company ForgeRock sold to Thoma Bravo in a deal that valued that company at about $2.3 billion.

Focused on the growth stage

Riverwood describes itself exclusively as a growth-stage investor.

“The average revenue at entry of our investments is usually in the tens of millions, and our 75+ portfolio companies have grown their revenues at about 40% per year on average during the past decade,” said Francisco Alvarez-Demalde, co-founder & managing partner of Riverwood Capital.

While Riverwood invests globally, it is focused on backing companies located in North America and Latin America with the majority of its investments being in companies headquartered in the U.S. It has offices in Menlo Park, California; Miami, Florida; New York, New York; and São Paulo, Brazil.

“The technology opportunity in Latin America has been consistently expanding during the past 15 years, and our portfolio companies have been able to expand their revenues at +50% per year on average during that period,” Alvarez-Demalde said. “Tech investing in Latin America has been experiencing a correction, after the ‘peak’ in capital flows experienced in 2021.  Despite the volatility in capital flows and global investor interest in the region, the opportunity to build and expand technology businesses in Latin America has never been greater.”

Looking ahead, part of Riverwood’s playbook is to support the international expansion of its portfolio companies, including to Europe, Asia and other regions,” he added.

The firm’s assets under management currently stand at $5.8 billion, not inclusive of the capital from its final close. Because it discloses AUM on a quarterly basis, the firm won’t have an updated number with the final fund close figure until after the fourth quarter. It claims to have reached $7.3 billion of value across all investments.

More TechCrunch

A new crop of early-stage startups — along with some recent VC investments — illustrates a niche emerging in the autonomous vehicle technology sector. Unlike the companies bringing robotaxis to…

VCs and the military are fueling self-driving startups that don’t need roads

When the founders of Sagetap, Sahil Khanna and Kevin Hughes, started working at early-stage enterprise software startups, they were surprised to find that the companies they worked at were trying…

Deal Dive: Sagetap looks to bring enterprise software sales into the 21st century

Keeping up with an industry as fast-moving as AI is a tall order. So until an AI can do it for you, here’s a handy roundup of recent stories in the world…

This Week in AI: OpenAI moves away from safety

After Apple loosened its App Store guidelines to permit game emulators, the retro game emulator Delta — an app 10 years in the making — hit the top of the…

Adobe comes after indie game emulator Delta for copying its logo

Meta is once again taking on its competitors by developing a feature that borrows concepts from others — in this case, BeReal and Snapchat. The company is developing a feature…

Meta’s latest experiment borrows from BeReal’s and Snapchat’s core ideas

Welcome to Startups Weekly! We’ve been drowning in AI news this week, with Google’s I/O setting the pace. And Elon Musk rages against the machine.

Startups Weekly: It’s the dawning of the age of AI — plus,  Musk is raging against the machine

IndieBio’s Bay Area incubator is about to debut its 15th cohort of biotech startups. We took special note of a few, which were making some major, bordering on ludicrous, claims…

IndieBio’s SF incubator lineup is making some wild biotech promises

YouTube TV has announced that its multiview feature for watching four streams at once is now available on Android phones and tablets. The Android launch comes two months after YouTube…

YouTube TV’s ‘multiview’ feature is now available on Android phones and tablets

Featured Article

Two Santa Cruz students uncover security bug that could let millions do their laundry for free

CSC ServiceWorks provides laundry machines to thousands of residential homes and universities, but the company ignored requests to fix a security bug.

1 day ago
Two Santa Cruz students uncover security bug that could let millions do their laundry for free

OpenAI’s Superalignment team, responsible for developing ways to govern and steer “superintelligent” AI systems, was promised 20% of the company’s compute resources, according to a person from that team. But…

OpenAI created a team to control ‘superintelligent’ AI — then let it wither, source says

TechCrunch Disrupt 2024 is just around the corner, and the buzz is palpable. But what if we told you there’s a chance for you to not just attend, but also…

Harness the TechCrunch Effect: Host a Side Event at Disrupt 2024

Decks are all about telling a compelling story and Goodcarbon does a good job on that front. But there’s important information missing too.

Pitch Deck Teardown: Goodcarbon’s $5.5M seed deck

Slack is making it difficult for its customers if they want the company to stop using its data for model training.

Slack under attack over sneaky AI training policy

A Texas-based company that provides health insurance and benefit plans disclosed a data breach affecting almost 2.5 million people, some of whom had their Social Security number stolen. WebTPA said…

Healthcare company WebTPA discloses breach affecting 2.5 million people

Featured Article

Microsoft dodges UK antitrust scrutiny over its Mistral AI stake

Microsoft won’t be facing antitrust scrutiny in the U.K. over its recent investment into French AI startup Mistral AI.

1 day ago
Microsoft dodges UK antitrust scrutiny over its Mistral AI stake

Ember has partnered with HSBC in the U.K. so that the bank’s business customers can access Ember’s services from their online accounts.

Embedded finance is still trendy as accounting automation startup Ember partners with HSBC UK

Kudos uses AI to figure out consumer spending habits so it can then provide more personalized financial advice, like maximizing rewards and utilizing credit effectively.

Kudos lands $10M for an AI smart wallet that picks the best credit card for purchases

The EU’s warning comes after Microsoft failed to respond to a legally binding request for information that focused on its generative AI tools.

EU warns Microsoft it could be fined billions over missing GenAI risk info

The prospects for troubled banking-as-a-service startup Synapse have gone from bad to worse this week after a United States Trustee filed an emergency motion on Wednesday.  The trustee is asking…

A US Trustee wants troubled fintech Synapse to be liquidated via Chapter 7 bankruptcy, cites ‘gross mismanagement’

U.K.-based Seraphim Space is spinning up its 13th accelerator program, with nine participating companies working on a range of tech from propulsion to in-space manufacturing and space situational awareness. The…

Seraphim’s latest space accelerator welcomes nine companies

OpenAI has reached a deal with Reddit to use the social news site’s data for training AI models. In a blog post on OpenAI’s press relations site, the company said…

OpenAI inks deal to train AI on Reddit data

X users will now be able to discover posts from new Communities that are trending directly from an Explore tab within the section.

X pushes more users to Communities

For Mark Zuckerberg’s 40th birthday, his wife got him a photoshoot. Zuckerberg gives the camera a sly smile as he sits amid a carefully crafted re-creation of his childhood bedroom.…

Mark Zuckerberg’s makeover: Midlife crisis or carefully crafted rebrand?

Strava announced a slew of features, including AI to weed out leaderboard cheats, a new ‘family’ subscription plan, dark mode and more.

Strava taps AI to weed out leaderboard cheats, unveils ‘family’ plan, dark mode and more

We all fall down sometimes. Astronauts are no exception. You need to be in peak physical condition for space travel, but bulky space suits and lower gravity levels can be…

Astronauts fall over. Robotic limbs can help them back up.

Microsoft will launch its custom Cobalt 100 chips to customers as a public preview at its Build conference next week, TechCrunch has learned. In an analyst briefing ahead of Build,…

Microsoft’s custom Cobalt chips will come to Azure next week

What a wild week for transportation news! It was a smorgasbord of news that seemed to touch every sector and theme in transportation.

Tesla keeps cutting jobs and the feds probe Waymo

Sony Music Group has sent letters to more than 700 tech companies and music streaming services to warn them not to use its music to train AI without explicit permission.…

Sony Music warns tech companies over ‘unauthorized’ use of its content to train AI

Winston Chi, Butter’s founder and CEO, told TechCrunch that “most parties, including our investors and us, are making money” from the exit.

GrubMarket buys Butter to give its food distribution tech an AI boost

The investor lawsuit is related to Bolt securing a $30 million personal loan to Ryan Breslow, which was later defaulted on.

Bolt founder Ryan Breslow wants to settle an investor lawsuit by returning $37 million worth of shares