Dallas-based Cypress Growth Capital announced the first closing in its third royalty-based growth capital fund, CGC Royalty Investments III LP.

The $42 million fund is aimed at providing financing to emerging software and technology enabled service companies in the Southwest, Cypress Growth said in a news release.

“We were well positioned to quickly raise the new fund based on our market-leading position as the largest and most-active royalty-based growth capital firm in the United States.”
Bart Goodwin

Investors in the fund include a varied group of family offices and select individuals active in the technology arena, according to Cypress.

“We were well positioned to quickly raise the new fund based on our market-leading position as the largest and most-active royalty-based growth capital firm in the United States,” Bart Goodwin, Cypress Growth Capital co-founder and managing director, said in the release.

“With a track record of more than two dozen royalty-based investments since 2011 and consistently successful outcomes for our portfolio companies, our royalty model is a compelling alternative to venture capital and traditional debt options.”

Cypress Growth said it is actively looking for growing companies that are led by committed entrepreneurs who value their equity.

It is seeking companies in software and technology with annual revenue of $3 million to $20 million that are profitable or nearing profitability. The companies must have two years of operating history, headquartered in the U.S., and have growth capital needs up to $5 million.

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