Vintage Investment Partners has closed its latest fund of funds, Vintage Investments VII, on $144 million, above its target of $100 million, according to a statement from the firm.
Funding for the vehicle – Vintage’s third fund of funds – was mainly secured from US, Canadian and Israeli financial institutions, endowments, foundations and family offices. Alan Feld, founder and managing partner of Vintage, told Private Equity International that around 80 percent of the LPs are continuing investors.
The fund will be making investments of between $5 million and $10 million in venture capital funds in the US, Europe and Israel and in technology-related private equity funds in Israel, as well as buying low-funded secondary and early secondary positions in these types of funds.
Vintage has made a small number of investments outside of Israel with previous funds, but this is the firm’s first truly internationally-targeted fund of funds. “The difference here is [that] over 50 percent of the money will be going into the US and Europe,” Feld said. “We continue to deploy a substantial amount of money in Israel, it’s just now that we’ve jumped from a $92 million fund to a $144 million fund it was natural to take a significant part of that coverage and deploy it outside,” Feld said.
Feld said that around 75 percent of the investment put into companies in the Israeli market is made by non-Israeli venture funds with which the Vintage team has become well acquainted over a number of years.
“It was natural, then, as we started to get to know those funds and their investments in Israel, we got to know their investments abroad,” Feld said. “Once we started to study their investments abroad, we got to meet other funds and build our database of European and US funds generally.”
Feld said Vintage has been working “for a good five years” to build up a database to the point where “we have a fairly good idea of where we want to deploy”.
Since inception, Vintage has raised three secondary funds, a late-stage venture co-investment fund and two previous funds of funds. The firm’s previous fund of funds, Vintage Investments IV, raised $92 million in 2008.
The new fund, which held a first close on around $100 million in August, has already made four undisclosed commitments, Feld said. Vintage is likely to spend two to three years investing the fund in up to 15 core managers.
“There’s a Series A crunch, and that’s created opportunity for investing into funds that are focused on Series A,” Feld said, adding that there are a number of angel investors and microfunds making early-stage investments and a “fair bit of late-stage money also available”, creating a gap for funds focusing on Series A and Series B fundraising rounds.