News
Varicent Secures Strategic Investment from Warburg Pincus, Great Hill Partners and Spectrum Equity Jul 16, 2024
Latest Funding to Drive Next Phase of Innovation and Transformation of Sales Performance Management
July 16, 2024 (Toronto, ON) – Varicent, the industry leader in sales performance management (SPM) software, today announced a strategic investment led by Warburg Pincus, a leading global investor, alongside existing investors Great Hill Partners and Spectrum Equity, with participation from company management. Building on this investment, Varicent will continue to rapidly advance its proprietary Revenue Performance Engine framework, accelerate delivery of AI-driven capabilities, and reinforce its position in key markets globally. It is expected the transaction will close in the third calendar quarter of 2024 subject to customary closing conditions.
In today's competitive landscape, coordinating and aligning territories, quotas, incentive programs, and other sales plans is critical to achieving sustainable revenue gains and operational efficiencies. Revenue leaders seeking more profitable growth are constrained by processes and tools that are not designed for dynamic planning. Varicent's cloud-based platform optimizes sales performance through advanced operational and analytical capabilities, addressing critical challenges for sales, finance, and HR teams. As a recognized leader in The Forrester Wave™: Sales Performance Management Platforms, Q1 2023, Varicent's integrated solution streamlines processes from sales territory design to quota allocation and incentive compensation, providing powerful insights that align sales behaviors with strategic objectives.
With less than 50% of sales representatives having achieved quota since 2017[1], and nearly 70% continuing to miss their targets in 2024[2], there is an urgent need for solutions that optimize sales plans and drive peak performance. Varicent is actively addressing this market demand, with a 2024 Boston Consulting Group study revealing that Varicent customers reported revenue increases of 4-10%, along with enhanced labor efficiency and fewer errors.
“This strategic investment marks a pivotal moment for Varicent," said Marc Altshuller, CEO of Varicent. “With Warburg Pincus joining our existing investors, we solidify our foundation for further growth, strengthening our ability to further enhance our platform, customer experience, and partner ecosystem. Our Revenue Performance Engine has received an enthusiastic reception from customers and partners, highlighting its significant impact on optimizing sales plans and driving revenue. We believe Varicent is well-positioned to lead the industry forward in empowering organizations to optimize sales plans and incentive strategies that drive peak performance and revenue.”
"Varicent's position as a category leader, coupled with its experienced management team and strong customer advocacy, presents significant opportunities for continued innovation and market expansion. We're excited to support Varicent's next phase of growth, including potential strategic acquisitions and partnerships that will further solidify its leadership in the SPM space,” commented Vishnu Menon, Managing Director, Lauren Zletz, Managing Director, and Kevin White, Principal, at Warburg Pincus. "In today's complex business environment, sales performance management solutions are increasingly critical for organizations driving growth. Varicent meets this demand through its integrated platform, helping companies maximize results at every stage of the revenue journey. We look forward to partnering with Marc and his team, alongside Great Hill and Spectrum Equity, to bring Varicent into its next phase of growth.”
Drew Loucks, Managing Director at Great Hill Partners, noted, “Since investing in Varicent nearly five years ago, the company has continuously demonstrated its ability to be at the forefront of the SPM sector by supporting its customers with innovative and efficient solutions to enhance the entire revenue process. Setting a revenue goal is important to businesses across various sizes, industries and geographies, but implementing the appropriate strategy to actually reach that goal is critical, and our infusion of new capital into Varicent supports our conviction and confidence in the entire Varicent team and its strategy that the company is poised for continued growth and expansion. In addition to continuing to collaborate with Marc and the Spectrum Equity team, we are thrilled to welcome our friends at Warburg Pincus into the investor group as we all strive to build lasting value for Varicent and its key stakeholders.”
“Varicent’s success is a result of management’s relentless focus on helping customers meet their sales objectives,” said Chris Mitchell, Managing Director at Spectrum Equity. “We are thrilled to continue to support the company in further cementing its leadership position in this next phase of growth.”
William Blair and Guggenheim Securities, LLC are serving as exclusive financial advisors to Varicent, Great Hill Partners and Spectrum Equity; Moelis & Company LLC is serving as advisor to Varicent’s Board of Directors. Paul Hastings LLP and Blakes are serving as legal counsel to Varicent and Great Hill Partners. Harris Williams is serving as financial advisor, Kirkland & Ellis is serving as M&A counsel and Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as financing counsel to Warburg Pincus. Choate, Hall & Stewart LLP is serving as legal counsel to Spectrum Equity.
About Varicent
Varicent is an award-winning SaaS company that helps businesses fuel growth. Its suite of solutions supports a company’s entire revenue journey to help drive predictable growth, from results-driven planning of territories and quotas to incentive compensation. With Varicent, companies worldwide can set smarter goals and territories to maximize revenue potential, create incentive strategies that motivate the right behaviors to achieve revenue goals, and leverage AI-driven insights to make better decisions and outdo previous performance. To learn more about Varicent, visit www.Varicent.com.
About Warburg Pincus
Warburg Pincus LLC is a leading global growth investor. The firm has more than $81 billion in assets under management. The firm’s active portfolio of more than 215 companies is highly diversified by stage, sector, and geography. Warburg Pincus is an experienced partner to management teams seeking to build durable companies with sustainable value. Warburg Pincus has invested over $33 billion in technology companies since inception and is one of the most active growth investors in enterprise technology and cloud-based platforms, with notable investments including Avalara, Clearwater Analytics, CrowdStrike, Infoblox, Internet Brands, Modernizing Medicine, Net Documents, and WebPT. Since its founding in 1966, Warburg Pincus has invested more than $114 billion in over 1,000 companies globally across its private equity, real estate, and capital solutions strategies. The firm is headquartered in New York with offices in Amsterdam, Beijing, Berlin, Hong Kong, Houston, London, Luxembourg, Mumbai, Mauritius, San Francisco, São Paulo, Shanghai, and Singapore. For more information, please visit www.warburgpincus.com. Follow us on LinkedIn.
About Great Hill Partners
Founded in 1998, Great Hill Partners is a private equity firm targeting investments of $100 million to $500 million in high-growth companies across the software, digital commerce, financial technology, healthcare, and digital infrastructure sectors. With offices in Boston and London, Great Hill has raised over $12 billion of commitments and invested in nearly 100 companies, establishing an extensive track record of building long-term partnerships with entrepreneurs and providing flexible resources to help middle-market companies scale. Great Hill has been recognized for its industry leadership, being ranked in the top of five of HEC Paris-Dow Jones’ Mid-Market Buyout and Performance Ranking lists from 2021-2023. For more information, including a list of all Great Hill investments, visit www.greathillpartners.com.
About Spectrum Equity
Spectrum Equity is a leading growth equity firm with offices in Boston, San Francisco, and London. Founded in 1994, the firm has provided capital and strategic support to over 175 innovative software and data services companies spanning multiple industries, from finance and healthcare to cybersecurity and education. For 30 years, Spectrum’s deep bench of experience, domain-specific expertise, and track record of productive partnerships have set it apart as an industry-focused growth equity firm. Representative investments include Ancestry, Definitive Healthcare, GoodRx, Grubhub, Lucid Software, Origami Risk, SurveyMonkey and Verafin. For more information, visit www.spectrumequity.com
Contacts
For Varicent:
Bill Hobbib, Chief Marketing Officer
For Warburg Pincus:
Sarah McGrath Bloom
For Great Hill Partners:
FGS Global
For Spectrum Equity:
Margaret Jones
mjones@spectrumequity.com
[1] Alexander Group – 2023 Sales Compensation Trends Survey Executive Summary