The news
On September 29, Bain Capital took a minority stake in construction software maker Kahua at a valuation above $1 billion, a price well beyond public vertical SaaS valuations and a sign investors still pay up for software built for one industry.
Kahua, based in Alpharetta, Georgia, said the minority growth investment came from Bain Capital Tech Opportunities and followed the company crossing $100 million in annualized revenue. Neither side disclosed the size of the check. Local news site Hoodline, citing Bloomberg figures reported by Bisnow, put it at about $250 million and said Bain becomes Kahua's largest outside investor.
Kahua describes itself as an AI construction platform for complex capital programs. It says it serves more than 2,500 customers, including project owners and delivery teams in federal government, defense, transportation, healthcare, education, energy and data centers, with more than $400 billion in capital programs on its platform. The company said the money will fund AI and product work, sales expansion, customer success and hiring.
Also on September 29, Luminate Capital Partners, which says it manages more than $2 billion, announced a strategic growth investment in ITpipes, a Seattle company that makes pipe inspection software. Terms were not disclosed. ITpipes says more than 300 utilities, municipalities and sewer camera (CCTV) contractors use its software, and that its AiDetect tool codes pipe defects with 97% accuracy while cutting coding and review time by at least half.
A day earlier, on September 28, business communications software company Sangoma Technologies (SANG) agreed to be acquired by BRC Group Holdings (RILY), a diversified holding company. Sangoma said the cash-and-stock offer, worth US$5.225 per share, is a 47% premium to its last closing price and puts the company's enterprise value at about US$204 million.
The numbers
- Kahua valuation
- Above $1 billion
- Kahua annualized revenue
- $100 million
- Kahua customers
- 2,500+
- ITpipes users (utilities, cities, contractors)
- 300+
- Sangoma enterprise value in BRC deal
- About US$204 million
- Median public software EV/forward revenue (Multiples.vc)
- 2.2x
Why CEOs should care
For founders and boards of industry software companies, the message is that private capital, not the stock market, is where the premium sits. Crunchbase News reported that enterprise software was essentially absent from venture-backed IPOs in 2026, which it partly tied to AI's disruption of the sector. Kahua's deal suggests what buyers reward: a large installed base, deep ties to one industry and revenue at scale. A minority deal like Kahua's brings in capital without a sale of the company.
For CIOs and CFOs whose vendors take private equity money or change owners, the time to act is before renewal. Ask the vendor for written price caps on the next renewal, a product roadmap commitment, support levels and a clear data export path. Check contracts for change-of-control clauses. Sangoma customers, for example, would get a new owner if the BRC deal clears its approvals.
Utilities and city agencies weighing AI tools like ITpipes' defect coding should ask how accuracy claims are measured, who reviews the AI's calls before they drive repair budgets, and who owns the inspection data if the vendor is sold again. ITpipes cites the American Society of Civil Engineers' D+ grade for U.S. wastewater infrastructure, a reminder that these records feed real spending decisions.
The bigger picture
Public markets are far less generous. Multiples.vc's September 2026 data puts the median public software company at 2.2 times next-12-months revenue, and vertical SaaS companies match that figure on revenue, though they fetch a slightly higher multiple of EBITDA, a measure of operating profit (10.5 times versus 9.6 times for horizontal SaaS). The firm argues that industry-specific software builds deeper customer ties and higher switching costs. By our calculation, Kahua's valuation floor is more than 10 times its annualized revenue. Private minority deals and public enterprise values are not directly comparable, but the gap is wide.
Andrew Baldwin, a partner at Luminate, said ITpipes had earned the trust of the utilities, municipalities and contractors that depend on accurate inspection data. That kind of trust, built over years inside one industry, is what these buyers are paying for.
What’s next
Sangoma's sale needs a two-thirds shareholder vote, a separate majority vote that excludes certain parties, and court and regulatory approvals, with closing expected no later than early 2027. Kahua and ITpipes said they will put the new money into AI and product development. Watch whether more private equity firms pay premium prices for software that runs one industry's core work.
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