“It’s difficult to know what pace it’ll grow because it’s … dependent on how many really high-quality businesses we can find,” Jo Taylor, Teachers’ chief executive, told FP Finance.
He said searching for quality investments in the competitive and disruptive tech sector is worth the effort because, if the price is right, the growth profile and inherent risk relative to other sectors can juice returns.
“It’s a good asset class,” said Taylor. “It provides us with strong risk adjusted returns, whilst being more risky, and it’s growing because actually the value of our assets are growing really well.”
He anticipates that the Teachers Innovation Platform’s growth will come from both increasing revenues and profits at the firms the fund invests in, and further allocations of capital to the TIP team to lead investments, participate in syndicates, and provide “complementary” capital to support the late-stage venture and growth equity investments.
“It should grow as a proportion of that portfolio faster because it’s businesses where the growth … should be higher,” said Taylor. “But, also, we want to deploy more capital there…. And then (if) we continue to deploy capital at the rate we have been doing recently that should add to growth.”
TIP’s first investment following its creation in the spring of 2019 was in Elon Musk’s SpaceX.
There has been a steady stream of transactions since including a flurry in June. Among them, TIP led a $375-million Series D funding round for ApplyBoard, which valued the online platform that connects students to higher education around the world at $4 billion.
The same month, the Teachers’ team led a US$138-million Series C funding round for Beamery, an artificial intelligence-powered talent placement and retention company based in the United Kingdom, and teamed up with BlackRock to lead a $226-million series B round for Motif FoodWorks, a plant-based food technology company.
“You’ve seen us quite active, even this year,” Hindo said, noting that the COVID-19 pandemic added complication to many investment strategies. “We’re cementing and building our partnership approach and we take also (a) very direct approach ourselves here. Frankly, we’re excited.”