MassPRIM commits $89m to two long-term partners

Massachusetts Pension Reserves Investment Management Board’s established venture program is continuing to make commitments amid the coronavirus crisis.

The $70.69 billion pension fund recently re-upped with two long-term partners, Index Ventures and Flagship Pioneering.

Click here to read more in affiliate publication Buyouts of how MassPRIM’s PE program

is weathering the crisis brought on by the covid-19 pandemic

During its February board meeting, MassPRIM agreed to commit $18 million to Index Ventures X and $46 million to Index Ventures Growth V. The London and San Francisco firm announced in April that it closed its 10th $800 million early-stage fund and fifth $1.2 billion growth fund.

The pension fund has been a backer of Index Ventures since the firm’s €350 million sixth fund in 2012.

On March 23, MassPRIM approved a $25 million commitment to Flagship Pioneering’s seventh fund, which closed in April at $1.1 billion.

The Cambridge, Massachusetts-based life sciences firm is best known for its investment in Moderna Therapeutics, which went public in December 2018 with a valuation of $7.6 billion. The drug discovery company is currently running the first human trial of a potential covid-19 vaccine.

Flagship Pioneering and Index Ventures are among the better performing funds in the pension system’s venture portfolio.

MassPRIM’s other long-standing venture relationships include Spark Capital, Battery Ventures, Union Square Ventures and Insight Venture Partners.

“We’re optimistic that these new commitments, when we add it to the dry powder we’ve already got sitting on the sidelines, [are] going to be used in a deal environment that is being re-priced to earn better returns on a risk-adjusted basis than this environment that we just emerged from, where pricing was very high,” Michael Bailey, a MassPRIM senior investment officer and director of private equity, said at its board of trustees meeting on Tuesday.

He added, “The new deals will be put to work in an environment that prices risk more appropriately for buyers.”

As of early May, $9.19 billion or 13 percent of the MassPRIM’s total AUMs were allocated to private equity, surpassing the 12.5 percent target, according to data compiled by Private Equity International, an affiliate publication of Venture Capital Journal.