The investment comes through KKR’s Next Generation Technology Fund, which focuses on investments in software, security, internet, digital media and information services.
Vance Brown, Cherwell co-founder and chairman of the board, told the Business Journal this latest investment triples KKR’s initial $50 million investment in Cherwell in February 2017, which at the time was reported as the second-largest deal in Colorado Springs history.
“KKR tripling down, that’s an incredible statement to Cherwell and what we’ve done and the market we’re in, so we’re certainly excited about their belief in us,” said Brown, who also serves as interim CEO of the National Cybersecurity Center. “We want to be a hypergrowth company; KKR is committed to that, and the board is fully aligned for that. We want to bring a lot of jobs to Colorado Springs and Colorado and throughout the world and we believe we’ll accomplish that.
“Our goal is to dominate the mid-market for enterprise service management,” he added. “This is one of the hottest markets in the world today and one of the best executed markets in the world today.
“We’ve obviously been an incredibly high-growth company but it gets harder and harder to grow at scale, and what KKR brings to us is they know how to help us grow at scale. That’s what they do, that’s their expertise.”
Brown said some of the $172 million allowed KKR to buy out the majority of Insight Metro Partners’ holdings in Cherwell.
“Insight’s been in it since 2012 and that’s about the length that any equity fund wants to be in any one deal, so they can get out and call it a win,” Brown said. “KKR just got in in February  so this really resets the clock for our company in terms of being able to move forward.”
Brown said Cherwell expects to double its employee numbers within the next five years.
Cherwell offers software that has enabled thousands of organizations to modernize their business operations by automating services digitally, according to its news release.
“After establishing itself as a leader in the IT Service Management space, Cherwell is poised to expand into the service management market, which is estimated to top $30 billion by 2020 (including ITSM, “Low code” and PPM, according to MarketsandMarkets),” the release said.
“Since founding this company in 2004, we have committed to serving customers with intuitive technology that helps not only drive business but transform organizations,” Brown said in the release. “The demand for our platform has continued to expand globally and the leadership at KKR is aligned with the company’s vision for growth.”
As organizations of all sizes seek to connect disparate digital services and data silos in order to gain more insight, efficiency and productivity, Cherwell’s platform unifies the tools that ensure their businesses are as efficient as possible. Companies, schools, hospitals, and government agencies all over the world depend on Cherwell’s solutions to manage their IT operations and, increasingly, achieve digital transformation across their organizations.
“Cherwell Software’s evolution into a global technology company in a little more than 10 years is one of the state’s high-tech success stories,” Colorado Governor John Hickenlooper said in the release. “The innovation and highly skilled jobs this company has produced demonstrates some of the best of what Colorado Springs and Colorado has to offer. I’m proud to see Cherwell continue to attract investment to Colorado and lay the groundwork for even more growth in the years ahead.”