Francisco Partners raises a record $18 billion despite the M&A slump

Francisco Partners, one of the leading private equity firms focused on technology companies, has raised more than $18 billion for two new funds. That is the largest raise in the firm's history. The timing makes it stand out: the money came in during a global M&A slump and amid growing investor doubts about inflated valuations in the AI sector.

A record raise in a downturn

Private capital in tech is going through one of its toughest periods in years. Large deals are being postponed or frozen, startup valuations are being marked down sharply, and prospective investors would rather hold on to their cash and wait for things to settle.

Against that backdrop, Francisco Partners' result is impressive, and it also seems to contradict the broader market almost to the point of paradox. The firm didn't just hit its fundraising target; it exceeded it. That suggests investors see something in the firm they are willing to take comfort in, even in grim times.

Francisco Partners' portfolio includes more than 200 companies the firm has worked with over two decades. Its track record is full of successful bets: it found young companies early, helped them grow and mature, and then sold them to large strategic buyers or took them public through IPOs at a multiple of its investment. That track record is the main pitch to new investors.

Where the money goes

Francisco Partners focuses on technology that solves concrete, tangible business problems, not on speculation about the future or hypothetical AI use cases. Its main investment areas:

• Cloud computing infrastructure and data centers
• Digital security, data protection, and cybersecurity
• Business software (SaaS, management systems)
• Healthcare technology and biotech
• Sustainability and environmental solutions

The portfolio includes some well-known names: Alteryx (data analytics), Jamf (Apple device management for businesses), and Eze Software (fintech platforms for investment firms). Each of them eventually had a successful exit, either through M&A or an IPO.

These aren't speculative bets on tomorrow's hype. They are investments in companies that already show steady revenue growth and a path to profitability. In hard times, that approach is the most convincing argument investors can hear.

What it signals to the market

Francisco Partners' success sends several important signals that everyone in the market should pay attention to.

First, big venture capital is still active. Yes, there is a downturn, and it's real. But it doesn't mean paralysis; it means reallocation. Capital is concentrating in firms with a proven track record, while smaller or newer funds are finding it harder to raise.

Second, investors can tell hype from reality. Everyone is talking about AI, but investors are willing to back companies that solve specific problems: cloud, security, software. Speculative interest in pure-play AI may cool, but demand for real, useful technology remains.

Finally, the market rewards experience and track record. Francisco Partners raised record money not because it pitches investors well, but because it has a proven history of finding and growing companies. In an era of doubt, that is the strongest argument there is.