[PE Portfolio]⑦ Praxis Capital Partners... The Secret Behind a 41% IRR Return

Consulting Firm-Originated Management Team... Advantage in Quickly Reading Market Changes
BusinessOn, Doosan Robotics, and Others Achieve Successful Exits Through Proactive Investments

Founded in 2013, Praxis Capital Partners is an independent private equity firm specializing in buyouts and growth capital investments primarily in the Korean middle market (investment market targeting small and medium-sized enterprises and mid-sized companies). Since its inception, it has managed funds exceeding KRW 1.242 trillion. The firm has built a solid track record by making strategic investments in 23 companies and achieved a high internal rate of return (IRR) of 44.1% through 14 exits.

The Secret Behind Being Selected as a Fund Manager Entrusted by the National Pension Service

Praxis Capital was recently selected as a domestic private equity fund (PEF) manager entrusted by the National Pension Service (NPS), alongside MBK Partners, Premier Partners, and JKL Partners. The NPS plans to invest up to KRW 1 trillion in this project. Each fund manager autonomously proposed investment amounts ranging from KRW 150 billion to KRW 350 billion. Praxis Capital is a PEF that has grown by generating high returns through proactive investments in innovative companies.

Recently, Praxis Capital sold the enterprise Software-as-a-Service (SaaS) company BusinessOn to Skylake Private Equity for KRW 380 billion, achieving a 3.1x return on investment within five years. The IRR reached approximately 26%. Established in 2007, BusinessOn is the market leader in electronic tax invoice solutions. It operates businesses such as electronic contracts, integrated management, and intelligent big data services. Naver has also reviewed acquiring specific business units of BusinessOn. Praxis Capital acquired a 46.91% stake in BusinessOn in 2019 for a total of KRW 95 billion at KRW 8,789 per share. At that time, the company valuation was in the low KRW 200 billion range, marking the first management control transaction in Korea’s SaaS sector.

Ramin Sang, CEO of Praxis Capital, served as co-CEO of BusinessOn and strengthened the bolt-on strategy by consecutively acquiring similar companies to expand market dominance. They analyzed the related market and reviewed over 50 competitive companies. Starting with the electronic contract service provider Glosign in 2020, Praxis Capital successively acquired data analytics firm Planit Partners, accounting solution provider Nudge Partners, and HR management platform Shiftee. By owning more than 10 SaaS product lines including financial accounting, electronic contracts, data, and HR, BusinessOn became the number one company in Korea. Revenue increased from KRW 15.6 billion in 2019 to approximately KRW 51 billion last year, a 227% growth over four years.

Earlier this year, Praxis Capital made a successful exit from Doosan Robotics just two years after investing, achieving a 6.5x return on invested capital and an IRR of 186%. They invested KRW 30 billion and recovered a total of KRW 196.5 billion. This was the first investment case in the robotics sector among domestic PEF managers. At the time of investment, Doosan Robotics had been operating at a loss since its launch in 2015, and its sales were only in the hundreds of billions of KRW, making the investment decision challenging. However, the bold investment strategy paid off. Praxis Capital viewed the collaborative robot sector as a high-growth potential investment area and conducted over a year of studies on growth prospects and major domestic and international companies. After the investment, Praxis became the second-largest shareholder, joined the Doosan Robotics board of directors, and provided strategic consulting on bolt-on investment opportunities and key strategic tasks as a board member and financial partner.

Praxis Capital, the chairman company of the PEF Operators Association, CEO Ramin Sang. Photo by Younghan Heo younghan@

Agile Response to Market Changes is an Advantage; Focus on Blind Fund Formation and Additional Exit Opportunities

Praxis is recognized as a PEF that quickly adapts to market changes by building a team where more than half of the investment personnel, including the three co-CEOs Ramin Sang, Lee Kwan-hoon, and Yoon Joon-sik?all former consultants at Bain & Company?come from strategic consulting backgrounds. Industry insiders cite the continuous collaboration of founding members without any departures since the company’s establishment in 2013 as Praxis’s greatest strength.

Praxis is gaining momentum in forming blind funds thanks to its strong investment performance. The ongoing fundraising for an KRW 800 billion blind fund is progressing smoothly. Praxis was selected as a fund manager in three investment projects in the first half of this year alone. It was chosen in the mid-sized category for the second round of the Growth Support Fund, receiving KRW 80 billion, and allocated KRW 30 billion in the mid-sized category of the Government Employees Pension Service. More recently, it was also selected in the National Pension Service’s PEF investment project. Praxis applied for KRW 300 billion in the NPS investment project. Although the final investment amount is flexible, Praxis has raised about KRW 500 billion by achieving good results in the first half’s investment projects. Having raised over 60% of the fund target within half a year, an early close of the blind fund is anticipated.