Solstice Capital — Q2 2026 Limited Partner Update

SOLSTICE

Solstice Capital · Fund II

Q2 2026 · Limited Partner Update

Solstice Capital

Growth Equity · Technology & Digital Health

This document is prepared for informational purposes only and is intended solely for the use of existing limited partners of Solstice Capital Fund II, L.P. Distribution without express written consent is prohibited.

Fund Size

$280M

Vintage

2023

Strategy

Growth
Equity

Fund Life

10 yr

01 / 10

2026

Q2 2026 · In Brief

A quarter of selective conviction.

Deployed Capital

$168M

of $280M committed +$22M vs Q1

IRR Net

19.4%

since inception ↑ 1.2pp vs Q1

DPI

0.31×

distributions to paid-in +0.04× vs Q1

TVPI

1.62×

total value / paid-in ↑ 0.09× vs Q1

Q2 was characterised by two new platform investments and continued mark-up activity across the digital health sub-portfolio. Macro headwinds in late-stage public comparables compressed entry multiples further, which we view as a structural tailwind for our pipeline over the next two quarters.

02 / 10

FUND II

Portfolio · 8 Companies

Portfolio Overview — Q2 2026

Company	Stage	Invested	Curr. Value	MoM
Vanta HealthDigital Health	Series C	$28.0M	$54.6M	+18.2%
Meridian FreightLogistics & Supply Chain	Series B	$19.5M	$31.2M	+4.7%
Lumen AIEnterprise Software	Series B	$24.0M	$38.4M	+11.3%
Arbor FinancialFintech	Growth	$32.0M	$44.8M	+1.0%
Sycamore EDUEdTech	Series B	$15.0M	$17.3M	−3.1%
Corval ClimateCleanTech	Series C	$21.0M	$35.7M	+8.6%
Fenwick OpsIndustrial Tech	Series B	$14.5M	$11.6M	−8.4%
Soleil ConsumerConsumer Tech	Growth	$14.0M	$18.2M	+2.9%
Total		$168.0M	$251.8M	1.50×

03 / 10

NEW

Q2 Deployments · Two New Platforms

"We invest where network effects compound faster than competitors can acquire talent to replicate them."

— Investment Thesis, Solstice Capital Fund II

Both Q2 platforms were sourced through proprietary relationships cultivated over 18+ months. Neither was broadly marketed. We view sourcing quality as the single largest determinant of long-run returns, and both companies represent Solstice's core investment criteria: durable moats, founder-led management, and clear paths to category leadership.

Lumen AI

Enterprise AI Infrastructure

$24.0M

Check Size · Series B Lead

Lumen builds the orchestration layer for enterprise LLM deployments, enabling security-conscious customers to run frontier models in private cloud environments. ARR crossed $18M in Q1 2026 with 140% net revenue retention. Comparable infrastructure platforms have reached $1B+ outcomes; Lumen's TAM in regulated verticals is substantially underpenetrated.

Corval Climate

Industrial Decarbonisation

$21.0M

Check Size · Series C Co-Lead

Corval provides real-time carbon accounting and scope 3 traceability software to mid-market manufacturers. The regulatory tailwind from SEC climate disclosure rules is creating mandatory adoption cycles. 78 enterprise logos signed in the last 12 months. Co-led with Breakthrough Energy Ventures.

04 / 10

VANTA

Portfolio Spotlight · Q2 2026

Vanta
Health

Vanta Health builds AI-native care coordination software for value-based health networks. Founded in 2020 by former Epic and Flatiron Health engineers, the company has scaled from 12 health system clients to 94 in 36 months — without a traditional enterprise sales force. Their proprietary clinical workflow model reduces care gap closure time by an average of 34%.

ARR

$42M

YoY Growth

+86%

NRR

148%

Gross Margin

71%

A landmark partnership that redefines the addressable market.

In May 2026, Vanta Health signed a master agreement with Elevance Health, covering deployment across 14 Blue Cross Blue Shield affiliated plans and an estimated 4.2 million members. This is the largest commercial contract in the company's history and validates Vanta's expansion strategy from mid-market health systems into national payor networks.

The partnership accelerates Vanta's product roadmap around population risk stratification and creates a recurring revenue stream with contractual minimums through 2030. We marked the position up 18.2% following the announcement and independent third-party valuation.

4.2M

Members covered under Elevance Health agreement

05 / 10

MARKETS

Market Commentary · Q2 2026

"Valuations are compressing, but quality is emerging."

— Solstice Capital, Investment Committee, June 2026

01

Compression as Opportunity

The EV/ARR multiple for private growth-stage SaaS fell from a median of 8.4× in Q4 2025 to 6.9× in Q2 2026, driven by continued rate sensitivity and public market comparables. We view this as a rational correction rather than a structural shift. Companies with >120% NRR and clear FCF paths remain resilient and, at current entry prices, represent the most attractive risk-adjusted opportunities in Solstice's twelve-year history.

02

AI Infrastructure Bifurcation

The AI market is bifurcating sharply between commoditised model access — where margins are collapsing — and workflow infrastructure, where switching costs are compounding. Solstice's exposure is concentrated entirely in the latter. We believe the next 24 months will see further consolidation among point solutions, benefiting platform companies in our portfolio.

03

Healthcare IT Reset

Regulatory clarity on CMS interoperability mandates and the SEC's climate disclosure rules are creating two distinct mandatory adoption cycles — in healthcare IT and industrial SaaS respectively. Both are within Solstice's active coverage. We have seen inbound volume from quality founders in these verticals increase 40% year-on-year, and pipeline quality has improved commensurately.

06 / 10

II

Fund Metrics · Capital Account Summary

Investment pacing on plan.

Deployment Pacing by Vintage Year

2023 Vintage 100%

$48.0M deployed · 3 companies · fully invested

2024 Vintage 88%

$62.7M deployed of $71.0M reserved · 3 companies

2025 Vintage 52%

$31.5M deployed of $60.5M reserved · 2 companies

Reserve / Follow-on 40%

$25.8M drawn of $64.5M reserved pool

Remaining Dry Powder

$112M

available for new investments and follow-on reserves

Compound value creation across three cohorts.

The 2023 vintage is the most mature cohort and has generated the strongest absolute returns, anchored by Vanta Health's continued outperformance. The 2024 cohort is entering its inflection phase with Arbor Financial and Sycamore EDU approaching key milestones. The 2025 cohort — Lumen AI and Corval Climate — is early but tracking ahead of underwriting on every key operating metric.

Fenwick Ops remains the one position under active management; the board approved an operational restructuring in April 2026, and we expect clarity on the path forward by Q3.

Unrealised Value

$251.8M

Cost Basis

$168.0M

Realised Proceeds

$38.2M

Portfolio Companies

8

07 / 10

ESG

ESG & Governance · Annual Reporting

Value creation with intention.

Environmental

Climate &
Resource Stewardship

— Corval Climate's scope 3 traceability platform deployed across 3 portfolio companies, eliminating the need for manual emissions inventories and reducing third-party audit costs by 62%.

— Solstice adopted the TCFD disclosure framework for Fund II reporting, with climate scenario analysis completed by Deloitte in March 2026.

— All GP operations are carbon-neutral via verified offsets through South Pole. Portfolio companies are on a glide path to net-zero Scope 1 & 2 by 2027.

−34%

Aggregate portfolio Scope 1 & 2 emissions reduction vs 2023 baseline

Social

Workforce &
Community Impact

— Vanta Health's care coordination platform served 1.4M low-income Medicaid beneficiaries in Q2 2026, with a measurable 22% reduction in avoidable emergency department visits in covered populations.

— Solstice launched its Founder Fellowship programme, providing 10 pre-seed underrepresented founders with $50K grants, mentorship, and network access per cohort.

— Median portfolio company gender pay gap narrowed to 2.1% (from 6.8% at initial investment), tracked via annual total compensation audits mandated in investment side letters.

38%

Board seats across portfolio held by women or underrepresented minorities

Governance

Transparency &
Accountability

— All portfolio company boards now include at least one independent director with relevant operating experience, a condition enforced at Series B onward per our updated governance framework.

— Solstice adopted quarterly LP data packages aligned with the ILPA Data Convergence Initiative, enabling institutional LPs to aggregate and compare fund-level metrics without manual normalisation.

— No related-party transactions were entered into by any Fund II portfolio company without full LP advisory board disclosure and majority approval in Q2 2026.

100%

Portfolio companies with independent audit committees as of Q2 2026

08 / 10

2026

Forward Outlook · H2 2026 – 2027

"The next 18 months will reward
patience and precision."

— Investment Committee, Solstice Capital, Q2 2026

01

Deepen the Digital Health Portfolio

We are tracking four digital health companies at Series B, all within the value-based care and AI-enabled diagnostics verticals. We expect to close one to two new platform investments in H2 2026, with check sizes in the $18M–$30M range. The Vanta Health benchmark will serve as the primary underwriting reference frame.

02

Accelerate Follow-On Reserves

Lumen AI and Vanta Health have both signalled Series D processes in H1 2027. Solstice has pro-rata rights in both, and we intend to exercise fully — subject to LPAC review. We have $38M earmarked in follow-on reserves against current pro-rata entitlements across the portfolio.

03

Resolve Fenwick Ops Position

The board-approved restructuring at Fenwick Ops — including new CFO appointment and a revised go-to-market strategy focused on the US industrial heartland — will determine the mark in Q3 2026. We have stress-tested three scenarios; in all but the downside case, recovery exceeds current carrying value within 18 months.

09 / 10

SOLSTICE

Closing Summary · Q2 2026

A fund building quietly toward an exceptional outcome.

Solstice Capital Fund II is performing ahead of its 2023 vintage peer group on every primary return metric. The portfolio reflects nine investments made across three cohorts, with deliberate concentration in healthcare technology and AI infrastructure — two sectors where we have deep operating knowledge, differentiated sourcing, and the patience to hold through volatility.

We are grateful for the continued confidence of our LP community. Every capital allocation decision we make is made with your long-term interests as the sole constraint.

Net IRR (since inception) 19.4%

TVPI 1.62×

DPI 0.31×

Deployed Capital $168.0M

Remaining Dry Powder $112.0M

General Partner Contact

Morgan Ashford

Managing Partner
m.ashford@solsticecapital.com
+1 (415) 882-4400

LP Investor Relations

Clara Wentworth

Director, Investor Relations
lp-relations@solsticecapital.com
+1 (415) 882-4422

Fund Administrator

Citco Fund Services (USA) Inc.
citco.solstice@citco.com

Auditor

Ernst & Young LLP
San Francisco, CA

This document is confidential and intended solely for existing limited partners of Solstice Capital Fund II, L.P. The information contained herein is provided for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities. Past performance is not indicative of future results. All return figures are unaudited and subject to change. IRR and TVPI figures are calculated as of 30 June 2026 and include unrealised valuations based on internal marks.

10 / 10