View as Webpage

It's time for Lightyear's Q3 Update...

It’s great to be back in the office and reconnect after “Work from Anywhere” August. We hope you were able to take advantage of the time away from the office to travel, connect with family and friends, and recharge. Q3 was a very productive quarter, and we appreciate everyone’s hard work! 

A big congratulations on the successful exit of Engage PEO. As a reminder, in August, Fund IV sold a majority interest to Kohlberg & Company for a ~3.7x Gross MOIC and ~39% Gross IRR. The Engage PEO sale continues Fund IV’s steady pace of returning capital to its investors, representing the fourth exit to date following the sales of Therapy Brands (3.2x Gross MOIC) and Datalot (4.4x Gross MOIC) in 2021, and Cerity Partners (5.0x Gross MOIC) in 2022. These four exits have an average Gross MOIC of 4.0x. 

Our unrealized portfolio continues to perform well. We successfully completed 5 add-on acquisitions in Q3 (more detail below), bringing the total in the last twelve months to 31 and the portfolio grew revenue 18% August YTD 2023 vs August YTD 2022, which is a very strong result.

It’s official - Lightyear has a new website! In addition to launching the website, the IR team has continued its premarketing for Fund VI - completing over 100 investor meetings in Q3, including roadshows to Asia and the EU. The Legal team has been focused on drafting our terms & conditions and other offering materials that are essential for our upcoming fund launch. Not to be outdone, the finance team sent out over 15 financial statements and over 1,000 K-1s in August! 

In September, we held our first MD Retreat at Troutbeck in upstate NY. It was a great event where the MDs spent 2 days discussing fundraising, thought leadership, team building, and even had some time to learn axe throwing! We shared many of the key topics and takeaways during the first part of our firm offsite last week. Thank you to everyone who participated in our firm offsite and made the event successful. It was wonderful to end the day with a casino night and be able to share it with so many spouses and guests. The event did not disappoint with 44 prizes won!  

As we look forward for the remainder of the year, Q4 looks to be as busy as ever! We look forward to continuing our work on the ampliFI CV, the 2 deals currently under LOI, and a successful Fund VI launch!

Lightyear People News

After Labor Day, we officially welcomed Brendan Lenhard and Max Kunzmann as Associates on the Investment Team. Brendan came from Nomura, Max came from Greenhill & Co. and both were able to enjoy some time traveling before they joined Lightyear. 

In July, we welcomed Tom Naratil as an Operating Partner to Lightyear Fund V. Tom will support investments in the wealth management sector where he brings his experience as the former Co-President of UBS Global Wealth Management, President of UBS Americas, and as a member of UBS Group AG’s Executive Board. 

Please join us in congratulating Carter, who married Yenny on August 26^th and Daisy, who married Matt on September 23^rd. Congratulations, also, to Paul and Michelle who got engaged in August in Italy.

We had 26 employees celebrate work anniversaries during the last quarter!  

Investments Updates

Our portfolio companies closed five acquisitions in Q3:

• ampliFI - in July, ampliFI acquired Breakaway Loyalty, a Georgia-based loyalty rewards solution platform with 23 clients representing approximately $5M in Gross Billings and $1M in EBITDA.

• Engage - in August, Engage acquired Zamp HR, a Utah-based PEO with ~10,000 WSEs. Zamp HR expands Engage’s national footprint in a new geography and is the first acquisition post the August 1st recapitalization.

• PracticeTek - in August, PracticeTek acquired IPS, a practice management and electronic health record software platform. Together with IPS, PracticeTek now represents one of the nations largest retail healthcare solutions providers, serving over 40,000 clients. Fund V invested an incremental $54M to fund the transaction, resulting in a cumulative investment of $196M, representing the largest investment in Lightyear history.



• Wren Sterling - in July, Wren Serling acquired Messer & Mathews, a Guildford-based IFA. Shortly thereafter in August, Wren Sterling acquired Stockdale, a financial advisory and DFM business based in Bomdin. Together, the acquired firms add ~£400M in AUM. 



Portfolio Solutions News

On the hiring front, we added 2 c-suite executives:

• Jennifer Walsh – CFO at Schellman (Jen is a former CFO from Shapeways)
• Tim Schneible – COO at ProfitSolv (Tim is a former COO from PatientNow) 

Additionally, during the quarter, we hosted 2 virtual roundtables for our portfolio company executives in Q3 with the following topics:

• CMO - Aligning sales and marketing
• CHRO - Successfully attracting and retaining talent

Healthcare Offsite: On October 16th and 17th, Lightyear is hosting a healthcare offsite in Troutbeck, NY. The event brings together over 20 participants including industry executives, consultants, and various members of the Lightyear team including our Healthcare Advisory Committee, Healthcare Operating Partners, as well as select Portfolio Company CEOs.

Culture Working Group

We ended July with a boat cruise around Manhattan, which was a fun gathering before we worked from various locations in August.

Thank you to everyone who participated in our Operation Backpack day of service in July. Our donation helped contribute backpacks and school supplies to 19,000 students, which is the highest-ever number of children served through Operation Backpack.

The Culture Working Group meetings for those interested in getting involved in socialization and team building events, volunteer, donation and community service initiatives and further integration of our Core Values have been scheduled! 

We look forward to sharing updates on additional volunteer initiatives and events that are being planned for between now and the end of the year.