Pactio, building digital infrastructure for private markets, has raised £11 million in a Series A round led by EQT Ventures.

High-profile private equity industry insiders and tech angels also participated in the oversubscribed round, including former Stripe Europe CEO Matt Henderson and Volt founder Tom Greenwood. 

These new investors join prominent early backers including Monzo co-founder Tom Blomfield, GoCardless co-founder Matt Robinson, ComplyAdvantage founder Charles Delingpole, former FinCEN director Jim Freis, former Microsoft strategy lead Charlie Songhurst, AngelList CFO Weiheng Zhang and Entrepreneur First.

Pactio is creating the digital architecture for one of the largest asset classes in the world. Private capital is expected to almost triple in AUM to $29 trillion by 2040. 

However, with this unprecedented growth comes increasing complexity. The industry has swelled well beyond the original leveraged buyout to cover a myriad of investment strategies, including private credit, infrastructure, real estate, growth, and secondaries. In parallel, the investor pool has expanded via new structures promoting greater co-investment and retail access.

Navigating this complexity presents a new challenge for firms seeking to maintain a competitive edge, especially when they don’t have the right toolkit. Closing a transaction currently involves a precarious distribution of highly manual, error-prone workflows across a number of legacy applications and teams of investors, tax advisers, lawyers and fund administrators. 

Transaction teams struggle with generic tools that strain to keep up with so many moving parts, and the risk of errors is compounded by the threat of increasingly sophisticated cyberattacks. It is on these shaky foundations that the remainder of an investment’s lifecycle rests, so middle- and back-office teams are left playing catch-up as they grapple with vast quantities of critical data.

Informed by deep industry expertise, Pactio provides an intuitive solution to streamline private capital flows. Pactio’s offering sits much further upstream of existing tools, inserting advanced technology, including AI, directly into deal creation and closing workflows. 

By digitising transactions from the very start, Pactio is uniquely situated to address the root causes of complexity, de-risk workflows, and implement robust digital foundations for the entire investment lifecycle, paving the way for firms to pursue more sophisticated strategies.

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Pactio’s technology has received exceptional traction to date, underscoring its transformative potential for private markets. Pactio’s platform has already received support from some of the world’s leading professional advisers, including Big 4 tax advisers and top international law firms, as well as premier private equity firms. 

With strong endorsements from both its industry network and its investor base, Pactio will channel the proceeds of its Series A round to expand the reach of its digital infrastructure and scale its world-class team, which combines former private markets professionals and expert technologists with deep fintech and machine learning expertise. This will involve extending its single source of truth functionality and developing powerful AI enhancements to remain at the vanguard of private markets technology.

“Private markets are evolving into one of the largest and most complex asset classes in the world, yet this progress is being impeded by reliance on manual workflows and a tech stack that’s 30 years out of date,” said Eric Heimark, co-founder and CEO at Pactio. 

“As a former PE investor myself with a background in software engineering, it troubled me that the quality of tech does not match the sophistication of workflows and the talent of the parties involved. Investment teams deserve better: digital transformation can dramatically elevate the quality of work, reduce risk, and expand ownership in the private markets industry.”

Tom Mendoza, Partner at EQT Ventures, added: “We had been following the space for years, and when we met Eric and Lorenzo we immediately knew they were the team to back. The combination of their deep industry and tech expertise, compelling vision for how they will become the missing infra layer for private capital, and their early traction with industry leaders made it an easy decision.”

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