Carlyle’s Michael Wand: AI to play part in GBTEC’s BPM software services

Carlyle said in late November that it will acquire a majority stake in GBTEC from Main Capital.

Michael Wand, Carlyle

Carlyle Group‘s value creation plans for GBTEC Software include building out its artificial intelligence capabilities to enhance business process management (BPM) software services and creating new product opportunities, Michael Wand, MD and co-head of Carlyle Europe Technology Partners (CETP), told PE Hub Europe.

GBTEC provides an opportunity to invest into the “growing and underpenetrated” BPM software market, which has grown substantially in Europe in recent years and has a “good growth outlook”, according to Wand.

“The driving force for this growth is the accelerating adoption of professional BPM solutions in the technology sector, enabled by long-term growth trends such as digitalisation and automation of business processes, the increased focus on streamlining business processes and cost optimisation, and the increasing number of obligatory regulatory and audit requirements,” he said.

Carlyle said it will acquire a majority stake in GBTEC, a BPM and governance, risk and compliance software provider, from Main Capital Partners in late November.

Bochum, Germany-based GBTEC’s founder-CEO Gregor Greinke and the wider management team are re-investing and investing, respectively, Wand said.

Product portfolio 

Carlyle will work with GBTEC’s management team to develop its product portfolio, particularly in the area of digital process automation.

GBTEC’s product portfolio within BPM positions the company well for global expansion, so one of Carlyle’s next key steps is to build a local presence in the target expansion markets to unlock growth, Wand said. The target markets include the US and some European countries, including the UK.

Carlyle also plans to grow and optimise GBTEC’s existing operations in APAC and Spain.

The firm’s other focus will be on expanding GBTEC’s sales footprint internationally, to increase marketing spend to improve international awareness of the business, build a partner channel and ecosystem for enterprise customers and optimise the pricing model. “We also plan to build-out GBTEC’s go-to-market operations and its customer lead conversion and relationship building efforts, and the enterprise sale operation generally.”

The firm has identified areas for M&A and is developing its acquisition pipeline, he added.

Dynamic region for tech

Europe has emerged as a dynamic region for growing technology companies, supported by a growing tech investment scene, Wand said.

“Europe is particularly strong at creating and growing companies in the B2B technology sector – with GBTEC serving as a great example of this – and that is one clear driver of deals, along with Europe’s ‘coming of age’ in technology and the consequent interest and support of investors from around the world,” he said.

In technology, there are always factors which drive deals irrespective of constantly changing market conditions, Wand said. These factors include “opportunistic founder-driven deal scenarios, such as successions and growth planning or investing in internationalisation and scaling”.

“Working with founders and investing in founder-run businesses and primary transactions driven by these factors is a key investment theme for CETP,” he added.

In terms of exit, he said there is a flight to quality and the market is binary. “But for the right, high-quality assets, the exit market is functioning well and multiples have not declined significantly.”

Carlyle is positive on the outlook for 2024 and expects good opportunities for private equity generally. “We prefer to invest in primary deals where we can be the first real institutional shareholder, and we think opportunities like these will continue to arise in 2024 and beyond,” Wand said.

The opportunity in the European technology sector is “significant” and as always, those that are focused on fundamentals and long-term thematic trends should be optimistic, he added.