Avenue Growth Partners has closed its second investment fund at its $155 million hard cap, more than doubling the size of its inaugural fund as the growth equity firm looks to increase investments in vertical software and AI-enabled technology companies.
The oversubscribed fund, Avenue Growth Partners Fund II, follows the firm’s $83 million debut vehicle and reflects continued institutional demand for managers focused on early growth-stage enterprise software businesses serving specialized industries.
Fund II attracted commitments from a broad mix of institutional investors, including public pension funds, private foundations, funds of funds and family offices. Limited partners include Accolade Partners, Fairview Capital, GCM Grosvenor, Partners Capital and The Metropolitan Museum of Art.
Avenue invests in category-leading vertical technology companies, with a strategy centered on building concentrated portfolios that allow the firm to work closely with founders as they scale their businesses.
“A concentrated portfolio is core to our strategy,” said Ryan Russell, co-founder and partner at Avenue Growth Partners. “Every founder we back gets our full attention because our goal is to help them win their category. Fund II lets us do that with more resources behind each partnership.”
The new capital will support Avenue’s investment strategy targeting software companies that leverage artificial intelligence to modernize industries with complex operational workflows. The firm focuses on businesses serving markets where specialized domain expertise creates barriers to entry and long-term competitive advantages.
Alongside the fund closing, Avenue highlighted recent portfolio activity demonstrating continued momentum across its investments. Two companies from its first fund—Hive and Minga—recently completed recapitalization transactions with later-stage growth equity and buyout firms, providing validation of the firm’s investment approach and portfolio development strategy.
The firm also disclosed two new investments from Fund II.
Avenue led the $8 million Series A financing for Scispot, a software company developing an AI-native operating platform for life sciences laboratories. It also led the $10 million Series A round for Billables AI, which provides AI-powered timekeeping and revenue operations software for law firms.
According to the firm, both investments reflect its conviction that artificial intelligence is creating new opportunities to build industry-specific software platforms that automate highly specialized workflows.
“AI is making it possible for small teams to build deeply embedded products in industries that were historically too complex or specialized to automate,” said Brian Goldsmith, co-founder and partner at Avenue Growth Partners. “The founders we back are building AI-native platforms in sectors including labs, trucking, legal and equipment dealerships—categories where the next great technology companies will be built.”
Portfolio companies also credited the firm’s operational support beyond capital. Jason Richards, founder and chief executive officer of Minga, said Avenue played a key role in developing the company’s operating strategy during its growth phase and has remained engaged following its recapitalization.
The successful close of Fund II positions Avenue Growth Partners to deploy larger amounts of capital into early growth-stage technology companies while maintaining its concentrated investment model. As enterprise adoption of artificial intelligence accelerates across traditional industries, the firm is seeking to back software platforms that combine vertical market expertise with AI-native products capable of transforming operational workflows and establishing leadership positions within specialized markets.