Apollo looks to bring private capital to growth tech firms

The alternative asset manager has also been tapping into the startup economy more through its partnership with Cadma Capital

Apollo Global Management is partnering with venture capital firm 8VC on a new business to bring private capital to technology companies working in industries including aerospace and energy.

Apollo and 8VC said that they will aim to deploy “several billion US dollars” into the tech firms, which will also include businesses in the advanced manufacturing, life sciences, logistics and natural resources industries, according to a statement on Wednesday (Oct 29). The investments will be made from Apollo’s hybrid business, which can include asset-backed deals.

Apollo, which manages about US$840 billion in assets, has been expanding its private credit business in recent years. Earlier this year, the company created a New Markets division to tap into more wealth channels for those products.

The alternative asset manager has also been tapping into the startup economy more through its partnership with Cadma Capital. That business will also be involved in the new venture with 8VC.

“There is a growing need for creative, non-dilutive capital to support the companies driving industrial innovation,” said Matt Nord, co-head of equity and head of hybrid at Apollo. “Structured and asset-backed solutions can help bridge this funding gap and unlock large pools of capital for transformative companies.”

The initiative will invest in capital-intensive businesses that are building large-scale physical and digital infrastructure, Apollo said.

SEE ALSO

Apollo chief executive officer Marc Rowan said that the firm’s hybrid business had raised US$7 billion this year through August, and added that the division is expected to be its fastest-growing segment.

Apollo has been expanding its hybrid strategies, which supply financing that sits between credit and private equity, as it beefs up alternatives to buyouts. The firm manages about US$75 billion in hybrid strategies.

Joe Lonsdale, the founder of 8VC, is well known in the tech industry for his work creating Palantir Technologies alongside other major investors such as Peter Thiel. Lonsdale has also helped found wealth management platform Addepar and cloud software provider OpenGov. BLOOMBERG