SAN FRANCISCO – Hambrecht & Quist’s Access Technology Partners L.P. surged to almost three times its target and at press time had scheduled a mid-May wrap on $336 million, said Managing Partner Charlie Walker.
H&Q had planned to launch the fund a year ago, with the intention of raising $200 million for both direct deals and investments in funds (VCJ, July 1998, page 18). However, the fund-of-funds portion of the plan was quickly nixed when managers realized that a different limited partner base was required for each investment. H&Q opted to back direct deals, and Access Technology readjusted its focus. H&Q has indefinitely shelved plans to raise a fund-of-funds, Mr. Walker said.
Accordingly, a revised vechicle was launched last summer with its fund- raising goal trimmed to $150 million, including a $40 million pledge from H&Q (VCJ, September 1998, page 5).
Access Technology in February reached a first close on $154 million – excluding H&Q’s financial contribution (VCJ, March, page 20). Mr. Walker predicted at the time that the fund would reach $260 million, including H&Q’s $40 million. Nevertheless, the fund soared to $336 million by late spring, including a hike in H&Q’s investment to $65 million.
Most of the fund will invest in late-stage deals, with about one-quarter slated for early- to mid-stage companies and some 10% for special situations. Access Technology will concentrate on telecommunications, information-services, health-care and branded-consumer companies. Mr. Walker expects the vehicle to be invested over four years, and by press time the fund had closed a dozen deals.
Access Technology’s increased size is not expected to alter the firm’s investment strategy, and while the firm is in no hurry to add to its investment staff, H&Q is on the lookout for potential hires. “When we find good people, we will retain them,” Mr. Walker said. Access Technology has a nine-member investment team, including three partners, Nancy Pfund, Dan Case and Cristina Morgan, and Mr. Walker.
Mr. Walker declined to name limited partners, but said they include high-net-worth individuals and a broad base of American and European institutions. Investors were not troubled by the increased size of the fund and instead recognized that more capital would allow the vehicle to back a greater diversity of companies, Mr. Walker said. Limiteds also were pleased by H&Q’s increased participation in Access Technology, he added.