Building products distribution company QXO Inc., the startup created last year by XPO Logistics founder Brad Jacobs, has raised a $5 billion war-chest and intends to spend the money to grow its business through acquisitions, the company said Monday.
Greenwich, Connecticut-based QXO gained the backing through a $620 million round unveiled yesterday, which come immediately after it raised another $3.5 billion last week. Those investments followed the company’s initial backing, which included $900 million from Jacobs’ own investment firm, Jacobs Private Equity, and $100 million from Sequoia Heritage and other co-investors.
In addition to providing financial leverage, the latest round provides QXO with a high profile executive, naming former Trump Administration official Jared Kushner to a board seat. That arrangement comes as $150 million of the funding comes from the investment firm Affinity Partners, which was founded by Kushner.
According to QXO, its business model will center on providing technology solutions to clients in the manufacturing, distribution, and service sectors. The young company hasn’t yet acquired any firms in its target area of the construction and infrastructure products distribution sector, but it plans to ultimately make those providers more profitable by improving their technology and logistics practices.
In the meantime, QXO’s current revenue comes only from SilverSun Technologies, the small tech firm it bought as a staging area for its larger ambitions. Now a division of QXO, that firm still operates as a value-added reseller of business software for applications such as accounting, financial reporting, enterprise resource planning (ERP), warehouse management systems (WMS), customer relationship management (CRM), and business intelligence.
Editor's note:This article was revised on July 25 to clarify QXO’s business model.
