Mill Point Capital has sold Avenu Insights & Analytics, a provider of software used by governments for administration and revenue collection, to Arlington Capital Partners. Mill Point first invested in Avenue in January 2017.
Avenu’s products are used by more than 4,000 state and local governments to aid in the identification and collection of permits, license fees, and sale and use taxes; and to streamline internal operations, improve services, and improve online access to records. Centreville, Virginia-headquartered Avenu has more than 600 employees and is led by CEO Paul Colangelo.
“Mill Point created Avenu through two corporate carveout transactions – the 2017 acquisition of PRA’s government services division and the 2018 purchase of Conduent’s local and municipal government software business,” said Dustin Smith, a partner at Mill Point. “We have worked tirelessly with Paul and his team to create a true market leader in this fragmented industry.”
“Avenu offers an attractive platform from which to build upon given their robust product offering and strong leadership position in the highly fragmented state and local government markets,” said Michael Lustbader, a managing partner at Arlington Capital. “The company’s software maximizes revenue without raising taxes, simplifies government processes and meaningfully reduces costs, while providing greater transparency and an improved experience for citizens. We are excited to partner with Paul Colangelo and the broader Avenu leadership team as we further invest in and grow the business.”
Chevy Chase, Maryland-based Arlington Capital invests in government-regulated industries and adjacent markets including aerospace and defense; government services; and technology, healthcare, and business services. Arlington closed its $1.7 billion fifth fund in June 2019 and is currently raising its sixth fund which has a $3.5 billion target. The firm’s buy of Avenu was made through Fund VI. In February 2021, Goldman Sachs Asset Management made a non-voting minority equity investment in the firm.
“Partnering with Arlington Capital is an important step in Avenu’s growth trajectory. Arlington’s long history of success in government and software investing, combined with their robust experience and sterling reputation, make them the ideal investment partner,” said Mr. Colangelo. “Together we plan to further invest in and expand our product offering and capabilities while continuing our high standards of service and commitment to our customers.”
New York City-based Mill Point makes control-oriented investments in North America-based lower middle-market industrial, business services, and IT services companies. Mill Point closed its second fund, Mill Point Capital Partners II LP, at its hard cap of $886 million in February 2021. The firm’s inaugural institutional fund, Mill Point Capital Partners LP, closed at its hard cap of $450 million in May 2018.
“We are incredibly proud of the successful partnership with Paul and the entire Avenu team, as well as the many value creation plan achievements during our investment period,” added Mark Paolano, a partner at Mill Point.
“We highly value our joint accomplishments with the Avenu team which have positioned the company for long-term growth and market leadership,” said Chris Hearing, an operating partner at Mill Point.
Lincoln International was the financial advisor to Avenu on this transaction.
© 2023 Private Equity Professional | October 6, 2023
