Virtuous Software Funding Secured: $100M Round Led by Susquehanna Growth Equity
After years of navigating stormy waters, growth equity surged back into prominence in 2024, signaling a pivotal turning point for the sector. For an industry once beleaguered by dwindling valuations and investor skepticism, this year marked a remarkable transformation. From soaring deal values to shifting market dynamics, growth equity not only rebounded but also redefined its role within the broader private equity ecosystem, with notable successes like the Virtuous Software funding.
Growth equity’s share of total private equity deal value climbed to 12.7%, a stark rise from 9.9% in 2023. It also surpassed leveraged buyouts (LBOs) in sponsor deal volume for the first time in five years, capturing 21.5% of all transactions. This momentum was matched by a 33% year-over-year increase in U.S. growth equity deal value during the first nine months of 2024, signaling a broader revitalization across the private equity spectrum, including landmark deals like the Virtuous Software funding.
The comeback wasn’t limited to deal activity. A rebound in valuations—particularly for AI-driven companies, which experienced a staggering 61% increase in Q1of 2024—fueled renewed investor confidence. Against a backdrop of high interest rates and economic uncertainty, fund managers exhibited a keen focus on sectors promising quality investments at attractive prices, further invigorating the market.
Across the Atlantic, Europe mirrored this optimistic trajectory. Growth equity funds raised approximately $18 billion in 2024, a 4.8% uptick from 2023. The U.K. led the charge, accounting for over 40% of total European capital raised, while median fund sizes ballooned by 39.3%. Despite the headwinds, experienced managers commanded the lion’s share of investor attention, underscoring the market’s appetite for reliability amidst volatility.
Against this background Virtuous secured a $100M funding round led by Susquehanna Growth Equity (SGE), epitomizing the revitalized dynamism of growth equity in 2024.
Virtuous: Revolutionizing Nonprofit Fundraising with Technology and Generosity
In 2014, Gabe Cooper stood at a crossroads. After years of leading a large nonprofit and co-founding tech ventures like Brushfire Interactive and Shotzoom, he had seen the glaring disconnect between nonprofits’ missions and the tools they relied on to achieve them. Most organizations were constrained by outdated, impersonal software that treated donors as transactions rather than partners in change. Determined to solve this problem, Gabe founded Virtuous in Phoenix, Arizona, at 1 North 1st Street—a company committed to reimagining generosity through innovative technology.
Drawing from his deep nonprofit experience, Gabe built the company around the concept of responsive fundraising. This revolutionary approach empowers nonprofits to treat every donor as a major gift donor by leveraging data and automation to craft personalized, empathetic experiences. At its core is Gabe’s belief that generosity has the power to drive profound change and that nonprofits deserve modern tools to amplify their impact.
Virtuous Software Funding Fuels Exceptional Growth and Market Leadership
Virtuous quickly became a leader in nonprofit CRM and donor management. Its mission to “move the needle on global generosity” resonated across the sector, earning it recognition as a leader in the nonprofit CRM space by G2. Since its inception, the company has transformed the nonprofit fundraising landscape. With over 10,000 customers, including prominent organizations like Ronald McDonald House, Habitat for Humanity, and Arkansas Children’s Hospital, it has demonstrated exceptional growth. The company’s revenue has quintupled over the past three years, reflecting its expanding market presence and customer impact.
Following this trajectory, Virtuous’s valuation has soared, reportedly increasing fivefold since its $18 million Series B funding in 2021. While the exact valuation remains undisclosed, estimates suggest it now stands well above $500 million. Over the years, it has attracted significant backing from prominent investors, raising over $40 million from MATH Venture Partners, Seven Peaks Ventures, and Fulcrum Equity Partners. This momentum culminated in 2024 with a transformative $100 million funding round led by Susquehanna Growth Equity (SGE). The new capital is set to catalyze innovation, expand services, and further solidify Virtuous’ position as a leader in nonprofit technology.
Driving Innovation to Empower Nonprofits
With this investment, Virtuous aims to accelerate the development of cutting-edge features, including AI-powered tools, enhanced integrations, and third-party data insights. These advancements will empower nonprofits to make more informed decisions, personalize their outreach, and maximize their impact. Gabe Cooper shared, “This partnership with SGE is more than just capital; it’s a shared belief in our mission to advance global generosity. We’re committed to delivering the most innovative solutions for our customers.”
The funding will also bolster Virtuous’ customer success teams, ensuring nonprofits have the support they need to unlock the platform’s full potential. This focus aligns with the company’s ultimate goal of helping nonprofits generate $10 billion in net new generosity globally.
A Shared Vision for Transformative Growth
SGE’s involvement underscores the firm’s confidence in Virtuous’ ability to redefine nonprofit fundraising. Ben Weinberg, Managing Director at SGE, remarked, “Virtuous is revolutionizing how nonprofits identify and act on fundraising opportunities. Gabe and his team have built market-defining software that is transforming the sector, and we’re proud to support their growth.”
As part of the partnership, SGE team members Ben Weinberg and Aneesha Raghunathan will join Virtuous’ Board of Directors, bringing valuable expertise to guide the company’s strategic direction.
Setting the Stage for the Future
This $100 million funding round positions Virtuous to lead a new era of nonprofit technology. With a strong foundation, proven market success, and a clear mission, the company is poised to drive even greater innovation and impact. Virtuous’ story is a testament to the power of vision and persistence in creating meaningful change. As Gabe Cooper and his team continue to transform how nonprofits inspire generosity, one thing is clear: the future of fundraising is personal, data-driven, and powered by Virtuous.
Looking ahead, Virtuous’s continued growth aligns with broader trends anticipated in the growth equity space as markets adjust to stabilizing interest rates and improved economic conditions. Growth equity is expected to remain a vibrant sector, with several key themes defining its trajectory in the coming year.
Resilience in Fundraising Amid Stabilizing Rates: As interest rates reduce, there is cautious optimism about fundraising activities. Over 83% of general partners anticipate stable or increased fundraising levels in the coming year, reflecting improved investor sentiment and renewed confidence in growth equity strategies.
Potential Valuation Adjustments: While markets are recovering, valuation gaps could persist between company founders and growth equity investors, particularly for businesses facing adaptation challenges. However, companies with strong fundamentals and a proven growth trajectory are well-positioned to bridge these gaps and attract high-value investments.
Operational Enhancements and Competitive Deal Landscapes: Growth equity investors are expected to prioritize operational improvements within portfolio companies to optimize returns. This approach reflects the sector’s broader resilience, with firms doubling down on robust fundamentals post-recovery. At the same time, increasing competition in the space, fueled by interest from traditional private equity and venture capital, may result in more competitive deal terms.
Sectoral Focus and Cross-Border Investment Growth: Growth equity funds are likely to continue targeting high-growth sectors, including artificial intelligence, data infrastructure and sustainability-focused initiatives, mirroring global trends in innovation and responsible investing. Additionally, increased cross-border investments, particularly within Europe, are expected as international players seek opportunities in diverse markets.
Against this backdrop, Virtuous exemplifies how purpose-driven companies leveraging innovative technologies can thrive in a competitive and evolving landscape. Its success underscores the broader potential of growth equity investments to not only generate returns but also drive meaningful change across industries. The future of both Virtuous and growth equity now lies in the intersection of innovation, adaptability, and a relentless pursuit of impact.
