Recognize Makes Strategic Majority Investment in Sprout to Enhance ITAD Solutions

Recognize's Majority Investment in Sprout: A Step Towards Innovation in IT Asset Disposition

In a significant move for the digital services sector, Recognize, a private equity firm known for its keen focus on investing in digital businesses, has made a majority investment in Sprout, an IT asset disposition (ITAD) provider. This announcement was made on January 9, 2025, highlighting the mutual commitment to enhancing innovative solutions within the circular supply chain framework.

Founded in 2014, Sprout has positioned itself as a frontrunner in global ITAD solutions, specializing in the retirement of complex hardware portfolios ranging from endpoints to cloud systems. Their proprietary software platform integrates smoothly with the supply chains of some of the world's most privacy-conscious enterprises, allowing them to provide end-to-end services. These services not only improve data security but also prioritize sustainability and total-cost-of-ownership outcomes.

Currently, Sprout caters to over 200 large-scale enterprises in more than 40 countries across all six continents through its extensive network of processing centers. This strong footprint showcases the company's dedication to meeting the complex demands of its clients while adhering to high standards of privacy and data protection.

Shelly Li, the CEO of Sprout, expressed excitement about the investment, stating, "Recognize's specialization in the digital services sector, along with a strong alignment with our team on our North Star, made them an obvious partner for Sprout in our next phase of growth." Li emphasized the company's commitment to investing in their workforce and client relationships, aiming for collaborative growth with Recognize.

Charles Phillips, Managing Partner at Recognize, noted the increasing regulations and scrutiny surrounding secure data destruction and environmental, social, and governance (ESG) practices, which create a growing demand for Sprout's offerings. Phillips remarked, "Sprout is uniquely positioned in a market that is currently at an inflection point, as advancements in compute and demand for GenAI applications necessitate increased spending on infrastructure and hardware updates within enterprises." He also mentioned the firm’s eagerness to support Sprout's rapid expansion, investing in technology and exploring mergers and acquisitions opportunities.

The investment is not only strategic for Recognize but also marks a pivotal moment for Sprout, which has been backed by New Capital Partners since 2019. New Capital Partners will retain a minority stake in the company, ensuring that its expertise continues to guide Sprout's evolution within the ITAD industry.

With the backing of Recognize and the experienced leadership team at Sprout, the company is poised to navigate current market challenges while enhancing its service offerings in the IT asset disposition space. As businesses across the globe increasingly recognize the importance of data security and sustainability, Sprout's innovative solutions are becoming essential components of responsible IT practices.

For further information on Sprout's ITAD solutions and their expanding capabilities, you can visit their official website at www.sproutup.com.

In financial advisory roles, Robert W. Baird & Co. guided Sprout, while renowned firms such as Maynard Nexsen PC and Skadden, Arps, Slate, Meagher & Flom LLP acted as legal advisors. Recognize was similarly supported by legal counsel from Willkie Farr & Gallagher LLP.

As Sprout embarks on this exciting new chapter under Recognize's investment, the future looks bright for innovative collaboration in the ITAD industry, addressing the growing needs of enterprises around the world.