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Private Equity Fund of Funds Managers with an Investment Preference for Venture Capital - April 2013

by Jessica Duong

  • 04 Apr 2013
  • PE

Preqin’s Investor Intelligence database shows 234 private equity fund of funds managers that have previously invested in and/or have a current investment preference for venture capital vehicles. Fifty percent of these private equity fund of funds managers are based in North America, 35% are headquartered in Europe, 10% in Asia and 5% in Rest of World regions.

The largest of these, in terms of funds under management, is AlpInvest Partners. The Dutch private equity fund of funds manager is followed by HarbourVest Partners and Goldman Sachs Private Equity Group. Alpinvest had €34.1bn in assets under management as of October 2012 and approximately 70% of this is allocated to primary investments. The firm has a broad investment scope and makes commitments to various fund types, but has a particular preference for venture capital and buyout vehicles. Examples of funds it has invested in include Avalon Ventures VIII, Pond Venture Partners III and Sofinnova Capital V, which are all early stage venture funds.

As of October 2012, HarbourVest Partners had $35bn in assets under management and 66% of this is allocated to the primary private equity market. The firm’s international fund program aims to dedicate 35% of its capital specifically to venture capital funds and typically commits around $25mn per venture capital fund. HarbourVest Partners is very selective with investments in Western European venture capital funds; it has a preference for venture investments in countries with a strong entrepreneurial culture, such as the UK, France and Switzerland. The Harbourvest Partner IX range which is still believed to currently be on the fundraising trail includes a strand exclusively dedicated to venture capital. The fund is expected to seek opportunities in US venture funds and is targeting $1bn.

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