Veteran investors want to bring back old-fashioned growth equity that’s more about profits and less about unicorns.
Silversmith Capital Partners, a new growth equity firm launched by alumni of Bain Capital Ventures and Spectrum Equity, has closed its first fund with $460 million in capital commitments (including $10 million from the founding partners), Fortune has learned.
The Boston-based firm was launched earlier this year when Todd MacLean and Jeff Crisan stepped down as managing directors with Bain Capital Ventures, and Jim Quagliaroli left the same position with Spectrum Equity. The co-founding quartet was filled out by chief operating partner Lori Whelan, a former Bain & Company consultant who has spent the past several years in the quick-serve restaurant business.
Silversmith will invest in growing, profitable businesses in the technology and healthcare spaces. All of the team members — including up to a dozen new investment staff that has yet to be hired — will be based in Boston, but the portfolio is viewed as geographically agnostic.
“The one place you probably won’t see us too active is Silicon Valley,” MacLean explains. “While there are a lot of firms that have executed on momentum investing in unprofitable companies and that’s been renamed growth, we want to get back to the basics of what a lot of firms did in the 1990’s.”
Silversmith was targeting $350 million for the fund, with a $450 million hard cap (not inclusive of the founder commitment). Monument Group served as placement agent. All three investing partners will have identical fund economics.