Private equity firm Recognize, which closed its second fund at $1.7 billion in June 2025, is scouting for bets in India that are niche-specific service providers for large-scale enterprises in the US, according to a top executive.
“We’re not only looking for these niche companies and seeking to scale them,” said Muthu Kumaran, partner and head of India operations at Recognize. “These companies can have a seat at the table with Fortune 500 companies because in cases, they have specialized offerings that are deeper than what traditional IT services providers would do.”
The New York-based firm was founded by former Cognizant Technology Solutions Corp chief executive officer Francisco D’Souza alongside David Wesserman and Charles Philips. D’Souza was instrumental through his tenure from January 2007 to December 2019 in taking the Nasdaq-listed services company from $1.4 billion in revenue to over $16 billion, making him among the most successful CEOs in the space.
Recognize is currently investing out of its second fund. As part of Recognize II, the firm has invested in four platform services companies: SDG Corporation, a cybersecurity services firm; Sprout, a digital infrastructure company; TRANZACT, an insurance company; and HealthEdge, a software-as-a-service platform for healthcare companies.
The PE firm invests $50 million to $500 million and prefers to acquire majority stakes in its portfolio companies. It positions itself as an investor-operator – it doesn’t just provide capital, it is actively engaged in running its assets as well.
This is part of a larger investment strategy, where artificial intelligence is taking centre stage. The PE firm’s interest in niche companies comes as AI forces traditional companies to rethink their approach.
Mid-market companies with specific niches have begun drawing interest from private equity, with firms like Multiples moving to invest in -first service companies while paring bets in legacy segments like staffing and business process outsourcing. Other large PE investors include American alternative investment firm Blackstone and Sweden-based global investors EQT.
Nimbler companies
Given the size and nature of these companies, investors are betting that they’re nimbler and capable of moving faster with technology shifts than their larger rivals, which are evolving past the headcount-heavy delivery model.
While Recognize declined to say how many Indian companies it is evaluating as part of its deal pipeline, it said that there was a “good share” of companies in the country that are targeting the US and Europe. Kumaran said the firm had been in advanced talks with a couple of founders out of India for the past few months whose focus was on providing services to just Silicon Valley.
Ciklum, a London-based product engineering company that is a part of Recognize’s portfolio, set up a base in India primarily to tap the talent here. The company now has a full-fledged headquarters in the country.
Recognize’s team in New York generally leads investments, but Kumaran said his role in India is to help portfolio companies with operational recommendations.
“We have helped our portfolio companies set up and expand delivery offices across India and help them tap the talent here.”
In 2023, Recognize and Everstone acquired a stake in MediaMint, a digital advertising services company in Hyderabad with headquarters in San Francisco. While most of the company’s business comes from the US, its founders are from Hyderabad, and all of its delivery operations are conducted out of the city. Recognize declined to comment on the size of the investment.
Delivery teams
The firm is bullish on the ability of smaller to adapt to AI much faster than larger incumbents. Given how AI tools are advancing, Recognize expects that the technology will reshape delivery teams.
“AI will impact the traditional size and structure of project teams – visible shrinkage in team sizes and diamond-shaped structure may replace traditional pyramid structures and drive speed of execution,” Kumaran said.
Recognize’s portfolio companies, including Blend and Egen, were already operating on AI- and data-sciences-first delivery models well ahead of the current wave of AI adoption.
“Their runway is only stronger because AI has become front and centre in conversations these days,” said Kumaran, who was part of Cognizant for 26 years.
Recognize has recorded two full exits and one partial exit since it started investing in 2020. It sold developer talent cloud platform Torc to Randstad Digital in 2024 because of its more robust access to data on hiring practices around developers. Portfolio company AST, a cloud and managed-services provider, was sold to tech giant IBM.
“Both exits happened because there was more pull from these companies than a push from our LPs or our investment committee to exit,” said Kumaran.
Recognize partially exited its investment in digital BPO company 2X, selling to Inside Partners, a New York-based private equity firm for an undisclosed amount.