SME growth investor, Magenta Partners, has invested in Trustpay Global (TPG), an online Payment Service Provider (PSP) to enterprise customers in industries with complex international payment requirements. TPG represents the first investment of Magenta’s latest fund, which targets equity investments of £5m – £20m in to growth businesses. The investment follows on fast on the heels of Magenta’s latest exit, Halo Insurance Services, which generated an 11x return.
Founded in 2010 by Sandy MacAngus and Richard Smith, TPG is a specialist digital PSP, providing secure consumer payment processing for medium and large companies across mobile and internet based channels. Combining its proprietary technology platform (PCI DSS accredited) and e-Money Institution status, TPG provides a highly differentiated service offering to online merchants, targeting key areas such as funnel conversion, payment acceptance rates, fraud and charge back rates, and regulatory requirements. TPG is already processing payments in over 50 countries globally across mainstream and alternative payment methods.
Online payments now represent c.10% of all retail payments annually (c.$2tn), are growing rapidly (c.25% p.a.) and are forecast to double over the next 5 years. TPG’s historic focus of UK and European merchants who transact internationally is increasingly supplemented via a fast growing footprint in developing countries where internet and banking adoption is high but relatively underserved by local digital payment providers. Against this backdrop, the company has enjoyed significant sales and EBITDA growth.
The investment in TPG underlines Magenta’s approach of backing high growth, niche market leaders, while partnering with driven management teams and founders to accelerate their growth. Tom Matthews and Chase Emson of Magenta Partners have joined the TPG Board, and will work with Magenta’s Entrepreneur’s Club in supporting the company’s growth in to new merchant sectors and geographies.
Tom Matthews, partner of Magenta, comments: “We are delighted to have the opportunity to partner with such impressive entrepreneurs who have built a very differentiated business. We are relishing the opportunity of working closely with Sandy and Richard and our Entrepreneurs Club to help grow and scale the business over the coming years.”
Sandy MacAngus, CEO of TPG comments: “We searched for a long time to find an investor that could not only add value, but who appreciated the entrepreneurial nature of our business. The fact that the Magenta team have founded and managed high growth businesses previously, and have positioned their fund directly at supporting founders and managers, was a critical reason why we chose to partner with. The support of Magenta will help drive our sector and geographical expansion at an even faster rate, and we are looking forward to the journey together.”
Magenta were advised by Weil Gotshal & Manges, Smith & Williamson and Intuitus. TPG were advised by Osborne Clarke.
Magenta Partners was established in 2008 to capitalise on growth investment opportunities in the UK lower mid-market. Magenta is a relatively new manager with a highly entrepreneurial DNA and has invested into 9 different businesses. 5 of these have been exited – the most recent being Halo Insurance which generated Magenta an 11x return.
Magenta is primarily backed by the Singh Family Trust, the family trusts of New Look founder and entrepreneur Tom Singh. The Magenta investment team is augmented by their Entrepreneur’s Club, a group of successful entrepreneurs, most of whom they have backed, and who are used to working closely with Magenta in evaluating, investing in, and managing growth businesses. This Club consists of Tom Singh (New Look), Steve Parish (TAG, Crystal Palace), Gary Burke (Home & Legacy, iPrism) and Peter Roberts (Luminar, Tulip Inns, Pure Gym).
The Magenta team have also founded and grown their own business, Viva Gym, a market leading low cost gym operator in Spain and South Africa. Bridges Fund Management bought a controlling stake in Viva Gym Spain in 2015.
For more information on Magenta please see www.magentapartners.com
For more information on TPG, please see www.trustpayglobal.com