PSG, a growth equity firm partnering with middle-market software and technology-enabled services companies, and TPG, a global alternative asset firm have co-led a recapitalization in Government Brands, a provider of government software and integrated payment services. PSG will retain its majority stake in the company and TPG will become a significant minority shareholder. Greater Sum Ventures will exit its position in the company.
“We believe our partnership with PSG and GSV over the last few years has been critical to Government Brands’ ability to execute on our mission to empower all levels of government to transform how they engage with constituents by providing leading software and payment solutions,” said John Kristel, CEO of Government Brands. “We look forward to further scaling our platform to better serve our customers, in partnership with PSG and TPG, and thank the GSV team for their contributions to support our growth to date.”
Peter Wilde, co-founder and chairman of PSG, commented, “Currently 80% of government organizations are still at the initial stage of developing digital maturity. In our view, John and the entire Government Brands team have done an exceptional job building a platform to provide mission-critical solutions to a market undergoing crucial transformation. We believe the company is well-equipped to deliver technological solutions that will accelerate this transition to an even broader base of customers. We look forward to building on our partnership with the team to support governments entering the next chapter of digital connectivity.”
Tim Millikin, partner at TPG, commented, “Across industries, organizations are adopting technology at a fast pace to better serve the changing behaviors of their customers. Government Brands provides a robust suite of integrated software solutions purpose-built for government entities of all sizes. TPG has invested in vertical market software for many years, and our investment in Government Brands reflects our continued thematic focus on vertical payments and the digital transformation of the public sector. We look forward to working with John, Dave, and the PSG team with an aim to accelerate the company’s growth.”
“We believe that through the strength of its investors, strategic advisors, and talented management team, Government Brands has unlocked immense value for shareholders and customers alike,” said Ross Croley, CEO and Founder of GSV. “We’re pleased to have played a significant role in the evolution of this platform since its beginning and are proud of the innovation it brings to the government sector. We’ll follow the Government Brands story with interest and wish all parties continued success.”
For Government Brands, William Blair served as the exclusive financial advisor on the transaction. Shea & Co. acted as the sole financial advisor to TPG. TPG is investing in Government Brands out of its TPG Tech Adjacencies Fund, an investment vehicle focused on providing flexible capital solutions to the technology industry.