The Apax X Fund (which Apax Global Alpha has a stake in) has announced the sale of its minority stake in AffiniPay. AffiniPay is a market leader in professional services software and payments serving legal, accounting, architectural, engineering and construction firms. The buyers are Genstar Capital and TA Associates (TA Associates has been a stakeholder in AffiniPay, alongside Apax, since 2020).
Apax X ended up with its stake in AffiniPay after it sold its legal case management software company MyCase to AffiniPay in June 2022. Apax X acquired MyCase in October 2020, carving out the business from AppFolio, a publicly traded software company. The investment thesis was to capitalise on rapidly increasing technology adoption by law firms by investing in a leading player with clear improvement opportunities in go-to-market, product expansion, M&A, and carve-out driven acceleration of the business.
In 2022, Apax X sold MyCase to AffiniPay, retaining a minority stake in the combined business. During Apax X’s ownership, and with significant involvement from Apax’s Operational Excellence Practice, MyCase invested heavily into the sales and marketing function. The Apax team also supported four strategic acquisitions, which gave MyCase additional modules to cross-sell to customers as well as a leading position in other legal software categories.
When you factor in the initial sale of MyCase to AffiniPay, this transaction will deliver a realised gross MOIC of 4.2x and a gross IRR of 93%. On completion, and including earlier distributions, Apax Global Alpha will have received total proceeds of about €28m from MyCase/AffiniPay. This latest deal gives the company about €4m. This is 17.5% less than value as at 31 March 2024.