The Los Angeles City Employees’ Retirement System (LACERS) committed more than $38.4 million to three funds managed by General Catalyst. This marks the pension’s first new VC relationship in over a year.
The pension committed $10 million to General Catalyst Group X – Early Stage, $11.7 million to General Catalyst Group X – Endurance, and $16.7 million to General Catalyst Group X – Growth Ventures, according to board documents from its May 26 meeting.
In March, General Catalyst closed on a combined $2.3 billion in total for all three funds, with each strategy hitting its target.
The early-stage vehicle raised $600 million to invest in seed through Series B “innovation-driven” start-ups. The fund will invest up to $25 million checks in 40 or fewer companies with enterprise values below $150 million.
The growth sleeve racked up $1 billion to invest in 20-25 hyper-growth companies through checks of $25 million to $50 million with enterprise values above $150 million.
The endurance sleeve will closed $700 million for co-investments and follow-on rounds into 10 investments worth between $25 million and $100 million.
These are the first venture commitments the pension has made this year and the first commitment to a new VC manager that the organization has made since at least the beginning of 2019.
The pension invested $130 million into five different venture funds last year, all of which were existing relationships. The investments included a $25 million commitment to Oak HC/FT III, a $45 million commitment into NEA 17 and a $13.25 million into Spark VI.
Venture makes up 3.41 percent of the pension’s overall portfolio, or about $587 million, according to data from the end of the organization’s 2019 fiscal year.
The pension has steadily grown its exposure to venture over the last few years. In 2015, the strategy was 2.06 percent of the portfolio.
In November, the pension was recommended by advisor TorreyCove to reduce its VC target from 5 to 15 percent to 5 to 10 percent of the private equity bucket. The strategy currently makes up 13 percent of the private equity portfolio. The proposed changes have not been voted on yet.
LACERS was founded in 1937 and currently serves more than 31,500 active and retired members. The fund has more than $18.7 billion in assets under management.