SoftBank leads US$185m round in Pax8 at US$1.7b value

[SAN FRANCISCO] SoftBank Vision Fund has led a US$185 million investment in Pax8 Inc, that values the company at US$1.7 billion. Existing investors Liberty Global Ventures, Catalyst Investors, Sageview Capital and Blue Cloud Ventures participated in the round, said a statement on Monday (Apr 11).

The Denver, Colorado-based startup works with small businesses to help them manage an array of cloud technology services. Pax8 customers range from dentists to plumbers, who outsource their information technology needs to help run their business.

SoftBank managing partner Nagraj Kashyap said that the firm invested in Pax8 because it can be difficult to know what technology is needed to run a small business. Pax8 has developed an edge and will continue to grow, after scaling for 10 years, he added.

"We know the pain firsthand of what SMEs go through," Kashyap said of his experience working with smaller startups. "It's not easy to understand what to buy, how to buy it."

Pax8 chief executive officer John Street said that some of the newly raised capital could be used to make acquisitions that complement the startup's business, adding that the company could eventually hold an initial public offering. "We are scaling the company to potentially go public."

The business is growing in Europe, as well as expanding offices in emerging startup scenes around the US.

BLOOMBERG