Type Private Website www.vectorcapital.com Founded 1997 Total assets 3.3 billion USD | Products Private equity Founder Alex Slusky Number of employees 40 | |
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Industry Financial services, Investment management Headquarters One Market Plaza, San Francisco, California, United States | ||
Vector Capital is a private equity firm focused on value-oriented investments in technology companies. The firm invests across a range of situations including acquisitions of private companies, spinouts of non-core businesses from corporations, leveraged recapitalizations, pipes as well as public-to-private buyouts.
The firm, which is based in San Francisco, was founded in 1997. The firm has raised over $4 billion since inception across five private equity funds. Vector is currently investing out of Vector Capital V, a $1.4 billion investment fund raised in 2017.
Vector Capital traces its origins to 1997, when the team, led by Alex Slusky, completed a spinoff from Ziff Brothers Investments. The Vector team had begun making investments in the 1990s with financial support from the Ziff family, founders of Ziff Davis Media. William Ziff's sons Dirk, Robert, and Daniel manage the family's investments through Ziff Brothers Investments. Slusky led the technology equity practice at Ziff Brothers Investments, managing a portfolio of public and private technology investments. Slusky had previously been a venture capitalist at New Enterprise Associates.
In addition, the firm has a private credit business that invests in distressed debt or lends directly to technology companies. Consisting of special vehicles and hedge funds, the credit business has about $400m of assets under management. Vector tends to focus on more junior tranches of debt such as second-lien and unsecured debt. Slusky was quoted remarking on the credit business: “We’ll leave safe, secured debt to banks.”.
Among the firm's most notable investments are Aladdin Knowledge Systems, CollabNet, Corel, Gerber Scientific, LANDesk, Register.com, Saba Software, SafeNet, Savi Technology, Sizmek, Technicolor SA, WatchGuard, and WinZip.
The Corel purchase was characterized as a "strip and flip" by Nanette Byrnes of Bloomberg. According to Byrnes, "By ramping up Corel's debt from next to nothing to as much as $140 million prior to a May 2 [2006] initial public offering, Slusky has been able to secure a payout in cash dividends and stock sales of more than three times Vector's $58 million investment." In November 2009, a Vector-controlled holding enity took Corel private again. Since then, Corel, has continued to make numerous additional acquisitions. It currently remains in the Vector portfolio.
In June 2012, Vector won the shareholder vote to inject $242 million into Technicolor SA, a company focused on technology and digital media. The shareholders supported Vector's proposal over a rival proposal from JP Morgan. In 2015, Technicolor purchased the Scientific Atlanta division from Cisco for $600 million.