The StepStone Group, a private equity and secondary market advisor, has completed a direct secondary deal that involves assets acquired by legendary computer networking pioneer and venture capitalist Ray Noorda.
StepStone is financing the creation of a venture fund that will house legacy assets from Noorda’s investment firm, The Canopy Group, which has been in the process of winding down since Noorda’s death in 2006. Noorda amassed his fortune as chief executive officer of software and services giant Novell prior to founding Canopy 15 years ago.
Using capital from separate accounts from clients, including sovereign wealth funds, pensions and endowments, StepStone is backing the creation of Signal Peak Ventures, which will manage legacy venture capital assets from The Canopy Group, which was based in Utah.
Ron Heinz and Brandon Tidwell, both former managing directors at Canopy, will lead Signal Peak, according to Jim Gamett, a partner at StepStone who leads the firm’s secondary business. While nothing is official, Heinz and Tidwell may well choose to raise a new fund at some point in the future, Gamett said.
Financial details of the transaction were not disclosed. The portfolio includes equity and debt interests in 10 companies.
StepStone has been evolving relatively quickly from its origins as a private equity advisor to limited partners. The firm hired Gamett in 2008 to launch a secondary business, which has since executed dozens of deals across buyout, venture and energy assets.
The firm has completed numerous direct secondary transactions to date, Gamett said. In one of its biggest deals, the firm partnered with Lexington Partners to buy and manage out assets from Citi’s private equity holdings. Citi transferred about $4 billion of mature private equity assets to StepStone, including funds of funds, mezzanine funds, feeder funds and co-investment interests.