Fund Performance: MassPRIM Warms to Venture

The Massachusetts Pension Reserves Investment Management Board has been an uneven investor in venture capital over the past decade. It appears to have turned bullish in 2010 and 2011.

Investments by the pension manager vary year to year, sometimes remaining as low as one or two funds a year, other times spiking to eight or 10, according to its IRR reports and information that VCJ obtained through a public records request.

The vintage years 2010 and 2011 show a noticeable upswing in interest. MassPRIM added eight funds in 2010, with $160 million of commitments, and another six funds in 2011, with $121.3 million in commitments, according to a VCJ analysis of the obtained data.

The years are the most active since 2007.

Through the first three quarters of 2012, the organization added just three venture capital funds. Since then, it has bought into at least four 2013 vintage funds: Spark Capital IV, Technology Crossover Ventures VIII, Battery Ventures X and the Battery Ventures X Side Fund, according to interviews Chief Investment Officer Michael Trotsky gave to Pensions & Investments.

Even before 2010, MassPRIM was an active player in venture. From 2007 to September 2012, the pension manager bought into 25 VC funds, representing slightly more than a third of its private equity investments, according to the VCJ analysis. Commitments totaled $470.7 million.

During the period, it largely shied away from mega funds, investing in just two of $1 billion or more: Technology Crossover Ventures VII and Institutional Venture Partners XIV. Instead it participated heavily in med-tier funds, investing in nine ranging from $350 million to $800 million in size. It also favored smaller. Eleven of the funds were $270 million or less. (Fund size for three of the investments could not be determined.)

The pension manager appears simultaneously to favor a handful of GPs. MassPRIM has three funds from Spark Capital, four from Battery Ventures, three from Union Square Ventures, three from Index Ventures and two each from Institutional Venture Partners and Technology Crossover Ventures.

The accompanying chart lists MassPRIM’s venture investments from 2007 to September 2012, including commitments. The funds are listed by commitment size.