The digital transformation impacting blue-collar industries is a fundamental reimagining of how essential services businesses operate. There is a growing and exciting opportunity to use software solutions to both improve business operations and meet the increasing demand for tech tools among field workers — such as HVAC technicians, plumbers, electricians, and other service-based professionals.
Since its inception, RF Investment Partners has actively invested across three core verticals: Software, Business Services, and Healthcare Services. As a small and focused team, we always seek companies that provide mission-critical software or business models with essential products and offerings that limit competition and give our portfolio businesses the right to win.
Blue-collar workforce management software, a vertical highly coveted by technology investors, continues to represent a largely fragmented market. As private equity investors, we see the ability to partner with software companies to create opportunities with the right capital infusion to capitalize on this growing trend.
Gaining Efficiencies from Operational Software
For the last ten-plus years, Service-based businesses have been implementing software to transform operations. From implementing ERP solutions that manage operations to CRM platforms that better manage customers, the one constant is the trend of moving from point solutions to full-suite platforms that help services businesses automate several processes, creating greater efficiencies and operational scale.
ProSite Services, backed by RF in the summer of 2024, provides portable sanitation and dumpster rental services to construction, film, industrial, and other sectors. As a company, ProSite decided to implement ServiceCore, a Mainsail Partners portfolio company, to automate and gain efficiency across its operations. Today, ProSite uses ServiceCore’s software platform for job and inventory management, billing and accounting, route optimization, reporting, and messaging. This is an excellent example of a blue-collar-based business that has taken advantage of software to overhaul operating systems and establish best practices.
The market for waste management software is extensive, with an estimated total market size of $11B today, projected to reach $15.5B by the end of 20342. This not only includes software like ServiceCore but also captures another critical software application: field service software, which is designed to help employees manage their day-to-day.
Increasing Demand for Field-Based Workforce Solutions
For years, operators of Service-based businesses have been actively investing in and implementing all-in-one field services management software to equip their workforce with the technology needed to perform their jobs at the highest level.
Software investors have followed suit, pouring hundreds of millions of dollars into the sector, which, according to SNS Insider Private, is expected to grow from $4.3B in 2023 to $13.7B in 20321. The most notable outcome in this space, and perhaps one of the most anticipated software initial public offerings to date, was the 2024 IPO of ServiceTitan. ServiceTitan, a venture-backed vertical software application for the trade industry, has been a long-time darling of the space and a leader in end-to-end, cloud-based systems for trades, including plumbing, HVAC, roofing, pest control, landscaping, and many others.
Thanks in large part to ServiceTitan and the investors who poured over $1B into the platform, we’ve seen a meteoric rise in the number of exciting and compelling solutions in the field management space.
RF’s newest Service-based business investment, S&K Building Services, a provider of commercial and residential building cleaning services across the Midwest, has continued to expand its footprint with SmartService to provide its field technicians with mobile and desktop solutions that allow them to manage their schedule, handle quotes and work orders, automate billing, invoicing, and payments, in addition to the majority of their daily workflows.
Software offerings like SmartService give companies like S&K the needed tools to operate a more well-rounded business. This ultimately enables them to better service their customer base and build a more defensible business that can win in any market.
A Relationship-First Approach to Partnering with Software Companies
RF is optimistic that software focused on transforming the blue-collar business services industry will continue to be an attractive vertical in which to invest, and we are encouraged by the continued growth and innovation.
We currently partner with nine portfolio companies focused on Software and are seeking additional opportunities with software businesses with $5mm+ ARR. RF is active in the market and would love to connect with founders and management teams seeking a relationship-first capital partner with a flexible mandate and structure.
RF’s Business Services team had an exceptional 2024, adding several Essential Services platforms to the portfolio. As a team, when we think about how we can add value outside of capital, we are always talking about introductions to people to help scale the team, potential M&A opportunities, and where we can help our portfolio companies improve and gain competitive advantages. Given RF’s Software expertise, one of our strengths is helping our Business Services team think through operational efficiencies and improvements by implementing or upgrading the software our portfolio companies use.
RF Investment Partners is dedicated to using flexible debt and equity financing solutions to support transformative management teams in lower-middle-market companies. Led by a team with 100+ years of collective principal investing experience — including a dedicated software team — RF actively invests in Software/SaaS companies and has made thirteen software investments in the last four years.
About James Bishop
James Bishop serves as a Director for RF Investment Partners and leads the Charlotte office. He is part of the software team focused on direct-to-company sourcing initiatives. Prior to RF, James spent eight years helping build and lead Golub Growth, the growth-stage software investing arm of Golub Capital. As a senior investment professional at Golub, James was responsible for originating, executing, and helping monitor the firm’s equity and debt investments into growth-stage, mission-critical software applications. Earlier in his career, James spent time investing in software and healthcare services companies at TPG Growth, the growth arm of TPG Capital, and at WSC&Company, a private investment firm focused on investing in exceptional businesses via the search fund model and through middle-market buyouts.
If this article sparks any questions or there’s an opportunity you’d like to discuss, please reach out to James Bishop at jbishop@rf-partners.com
- https://www.globenewswire.com/news-release/2024/12/14/2997129/0/en/Field-Service-Management-FSM-Market-growing-with-a-significant-CAGR-of-13-7-by-2032-Increasing-Cloud-Deployment-and-Growing-Demand-in-the-Telecom-Sector-Research-by-SNS-Insider.html#:~:text=%E2%80%9CThe%20Field%20Service%20Management%20(FSM,period%20of%202024%E2%80%932032.%E2%80%9D
- https://www.thebusinessresearchcompany.com/report/waste-management-software-global-market-report
