The Canada Pension Plan Investment Board (CPPIB) has invested $50 million (about C$69 million) in Beacon Software, a Toronto company that buys software businesses and builds AI into their operations. The money comes from CPPIB's Growth Equity unit.
The investment expands Beacon's Series C round to $425 million. The round was first announced last June at $225 million and was led by General Catalyst and HarbourVest Partners, alongside Intrepid Growth Partners.
Beacon said it will use the new capital to speed up acquisitions and to hire what it calls "frontier AI engineers" to develop a shared AI operating system across its holdings.
The company's portfolio includes 45 businesses, mainly serving logistics, education, finance, manufacturing and utilities. Beacon reports more than $200 million in consolidated annual revenue and a valuation of $1.75 billion (about C$2.4 billion).
The model is sometimes compared with that of Constellation Software, the Canadian acquirer of software firms. Beacon gives portfolio companies a common technology platform and access to advisors from Instacart, Meta, OpenAI and Shopify. CEO and co-founder Nilam Ganenthiran is an Instacart alumnus.
Beacon was founded two years ago and has raised more than $750 million in total. It has opened offices in New York and San Francisco, and said last June that it was adding new portfolio companies almost every week. CPPIB has also made later-stage investments in Canadian companies including Cohere and Wealthsimple.
