Going a Mile Deep: Hg’s Nic Humphries on Building Global Software Champions and the Future of Private Markets
• 2 minute read
“The real advantage in investing isn’t luck — it’s discipline, depth, and time. That’s why we go an inch wide and a mile deep.”
— Nic Humphries, Senior Partner & Executive Chairman, Hg
When Alt Goes Mainstream sat down with Nic Humphries, one of Europe’s most influential private equity investors, the conversation went far beyond software — it explored what it takes to build enduring businesses, how AI is reshaping value creation, and why long-term investing in private markets has never been more compelling.
The Engineering Mindset Behind Investing
From growing up in a mining town to leading one of the world’s top 10 private equity firms, Nic’s journey reflects a distinctly engineering-driven approach to investing — logical, precise, and deeply long-term.
“We think like engineers. Before we invest, we ask what a company could look like in 15 or 30 years.”
That philosophy underpins Hg’s focus on mission-critical enterprise software — the unseen but essential systems that keep economies running, from accounting to payroll to compliance. These businesses may not be flashy, but they are predictable, resilient, and scalable — traits that have helped Hg deliver consistent 30%+ gross IRRs and low volatility over 25 years.
Europe’s Software Powerhouses — and Why Local Matters
Nic shared how Hg’s “inch wide, mile deep” specialization has built Europe’s strongest software ecosystem, with companies like Visma, P&I, and IRIS growing into multi-billion-euro category leaders.
While U.S. investors often focus on scale, Hg thrives in Europe’s complexity — multiple jurisdictions, languages, and regulations that create defensible moats and require local expertise.
“If you can build a payroll leader in Germany or Norway, you’ve done something even Silicon Valley can’t easily replicate.”
This deep specialization allows Hg to identify repeatable growth models across 27 European markets, turning niche local champions into global success stories.
AI: A Platform Shift — and a Once-in-a-Generation Opportunity
Nic describes AI as “the next 15-year platform shift,” comparable to the move from mainframes to PCs or from web to mobile.
“For the first time in human history, software development is getting cheaper — not more expensive.”
He argues that while AI brings short-term disruption, it will vastly improve productivity and enable software firms to move from the “Rule of 40” to the “Rule of 50+.” Hg is already embedding agentic AI into portfolio companies — leveraging automation and reasoning models to build smarter, faster, more scalable businesses.
Investing in Discipline and Longevity
One of the most revealing moments in the conversation came when Nic described Hg’s culture of discipline and reflection.
With a Realisation Committee overseeing exits, a continuous improvement culture, and a 0.9% historical loss rate, Hg has built an investment machine focused on low-volatility compounding, not high-risk bets.
“Our goal isn’t to chase unicorns. It’s to compound value, predictably, for decades.”
Opening Private Markets to Wealth Investors
For wealth audiences, Nic’s insights are especially relevant. Hg is pioneering access to private equity through vehicles like Hg Trust (the top-performing UK-listed investment trust) and Hg Fusion, its open-ended private markets fund designed for private wealth investors.
“If you’re not investing in private markets, you’re missing 90% of the opportunity set.”
Private equity, he explains, offers exposure to the 90% of companies that never list but drive much of the world’s innovation and growth. Hg’s long history in this space — with 17%+ annualized returns from its Trust — shows that access to institutional-quality private markets is increasingly available to individual investors.
Looking Ahead: AI, Access, and Alignment
The conversation closed with Nic’s trademark clarity about the future of investing and Hg’s role in it:
AI will drive productivity and product innovation across industries.
Private markets will continue to expand, supported by retail and wealth capital.
Alignment — between firm, investor, and company — will remain Hg’s North Star.
“We’re privately owned, and that means we make decisions for the long term — the next decade, not the next quarter.”
A huge thank you to @Michael Sidgmore and the Alt Goes Mainstream team for a thoughtful, wide-ranging discussion.
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👉 Alt Goes Mainstream: Hg’s Nic Humphries on Building Global Software Champions and AI’s Next Frontier
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