Digital Alpha Raises $1 Billion for Second Digital Infrastructure Fund

Gillian Tan (Bloomberg) -- Digital Alpha, a U.S. investment firm focused on digital infrastructure, has raised more than $1 billion for its second fund.

The vehicle -- Digital Alpha Fund II LP -- will build a portfolio of about a dozen investments. The fund won backing from sovereign wealth funds, pension funds, endowments and other investors from North America, Europe and the Middle East.

“We’re proud of the role our investments play in providing secure connectivity for private and public sector stakeholders during the pandemic,” Rick Shrotri, Digital Alpha’s founder and managing partner, said in an emailed statement.

The fund will invest in operating companies and strike revenue-sharing deals across three business segments: next-gen networks, cloud computing; and Internet of Things-enabled smart city solutions. The investor does not focus on fiber cables, data centers and radio masts -- a segment of digital infrastructure that’s been in favor with many other private equity firms.

Digital Alpha, with headquarters in Henderson, Nevada, will continue to partner with Cisco Systems Inc., and has access to the technology giant’s deal flow, engineering and sales resources. Shrotri is a Cisco alumni.

Digital Alpha’s investments to date include a $185 million commitment to WeLink Communications as it seeks to expand its fixed-wireless broadband effort across the U.S. The firm, which has offices in San Francisco and London, also committed to investing in the private investment in public equity, or PIPE, that’s backing digital health company Sharecare’s merger with Falcon Capital Acquisition Corp., a blank-check firm.