Japan's WM Partners secures debut deal

The stake purchase was part of $3 million bulk secondaries transaction - named Project Bridge - in which WMP acquired two LP interests and two portfolio investments, including Shanon, from an unnamed Japanese venture capital fund.

The deal includes a follow-on investment into Shanon by WMP via a convertible bond issue.

Set up in 2000, Shanon runs an online software-as-a-service (SaaS) platform that focuses on event management and allows users to automate marketing processes via email, social media and websites. The business claims to serve 600 clients with sales demonstrating a compound annual growth of 40% over the past five years.

WMP hopes to support the firm's continued growth as it plans to go public later this year.

Moriyoshi Matsumoto, managing partner at WMP, tells AVCJ that, while there are a number of early stage investors and mid-market buyout firms in Japan, the market suffers from a dearth of growth stage investors to form a bridge between the two. WMP hopes to fill the gap.

Matsumoto adds that many early stage GPs find themselves in a similar situation to their portfolio companies as they look to broaden their remit beyond their original investment theses - providing additional opportunity for traditional secondaries.

"We often have discussions with GPs who - at a later stage in the fund's life - have developed a different strategy to that of their existing LPs," he said. "We help GPs unlock these issues by providing solutions and offering both our experience and investment."

The Project Bridge investment was made via JSPF No.3 which was launched last year after WMP spun out from JAIC. Matsumoto, a former CEO of JAIC, was responsible for the group's secondaries business for more than a decade.

The fund reached a first close of JPY5.25 billion ($50.1 million) in January and is targeting a final close of JPY10 billion. LPs include several institutional and strategic investors, such as the government-backed Organization for Small & Medium Enterprises and Regional Innovation, Japan (SMRJ), which had put in JPY2 billion.

The last fund the WMP team managed while part of JAIC had a corpus of JPY8 billion. Over a period of 10 years, the team invested around $120 million and delivered a 2.7x return.

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• Topics
• Secondaries
• Secondaries
• Early-stage
• North Asia
• WM Partners
• Secondaries
• JAIC
• Growth capital
• Japan