By Chris NolterLike many growth equity firms, straddling the worlds of venture capital and private equity, Catalyst Investors is keen on cloud computing and the software-as-a-service billing model. "As time goes on almost all computing will be cloud based," Catalyst Managing Director and co-founder Brian Rich said. "It's a better model. It's a better product.Cloud and SaaS are not the sole focus of Catalyst's newly raised, $377 million fund. Upsized from an original target of $350 million, the fund will also back communications infrastructure outfits with wireless towers and data centers, as well as companies providing business and consumer services from digital media to e-commerce. The first investment in the new fund went to wireless tower group IWG Holdings II.Typical investments from Catalyst Investors IV will range between $10 million and $60 million. "We don't have to find the unicorn in our style of investing," Rich said, referring to tech startups with valuations over $1 billion. Recent exits include the $675 million sale of data center company Latisys Holdings LLC to fiber networker Zayo Group Holdings Inc. (ZAYO), which came to 15 times annual Ebitda, based on annualized results. Catalyst and Great Hill Partners LLC backed Latisys since 2007, a bit longer than the firm's typical 5-year holding period.Other high profile deals include a venture called Northstar Wireless LLC with Charlie Ergen's Dish Network Corp. (DISH) and other partners. The group bid more than $10 billion earlier this year in a government auction of wireless spectrum.While software-as-a-service has become a hot spot for PE recently, Rich said that Catalyst has been in SaaS for 15 years. The firm backed online messaging and Web security services outfit MessageLabs Group in 2000, and sold the company to Symantec Corp. (SYMC) for $695 million in 2008.The SaaS model, which is similar to selling a subscription rather than collecting a large, up-front licensing fee, is becoming ubiquitous in software."If you say you're going to invest in a software company, or a business services company that provides a software-based solution, saying that they are SaaS-based is like saying they use electricity," Rich said. "That's just the way it is done today. That's just the means by which people write the software because it is the best solution."Out of the Catalyst Investors III fund, the firm led a $27 Million round of investment in Conductor Inc. in February. Conductor helps businesses manage their web presence, through as social media, information on their web site and other means besides paid advertising. Other investors include FirstMark Capital, Matrix Partners, Investor Growth Capital and Blue Cloud Ventures.Software-as-a-service investments from Catalyst Investors III include payroll, recruiting and human resource software developer Ascentis; Clinicient Inc., which develops software to manage electronic medical records, billing, Medicare compliance and other tasks for physical therapists; and Decisyon Inc., which provides software for analyzing data, corporate planning, budgeting and other processes.MediaMath Inc., which built a platform on which advertisers and agencies purchase digital ads, is a SaaS investment from Catalyst Investors II. So is Mindbody, which provides software to manage booking, scheduling and sales for yoga and dance studios, salons and similar businesses that typically bill for appointments.CLOUD AND SAAS companies have a different profile from Catalyst's investments in communications infrastructure. "Those kinds of investments are really high growth, and sometimes have negative Ebitda because of the sales and marketing costs," Rich said regarding the software deals."With infrastructure investments, you generally have really good cash flow," he said. "It's very predictable. It's a totally different style of investment."The catch is finding infrastructure companies that are growing quickly. Canadian broadband provider Xplornet Communications Inc., which received funds from Catalyst Investors II LP in 2010, is growing at 20% annually, Rich said. The company provides rural consumers with broadband through satellites and terrestrial wireless networks."Believe it or not, as we sit here in 2015, there are still a lot of rural households that aren't connected to the Internet altogether or have some crummy connection," he said.Catalyst-backed InSite Wireless Group LLC bought nearly 300 wireless towers in April 2015 from CTI Towers Inc., a portfolio company of Comcast Corp.'s venture capital arm.Catalyst has a history investing in the wavelengths that carry wireless signals to towers, as well. The firm has backed spectrum companies Aloha Partners, which AT&T Inc. (T) acquired, and Denali Spectrum, bought out by AT&T's Leap Wireless.While wireless towers and spectrum have been around since Catalyst's early days, data centers and cloud computing have emerged more recently. Rich said that the style of investing has not changed."It's finding interesting growth businesses that we can take from call it a $50 million valuation to, if we're lucky, multiple hundreds of millions or more," he said. "We're looking for companies that have replicable growth models where we understand the unit economics really well."