Public pensions pile into NEA’s latest fund

Alaska Permanent Fund is the latest public LP to bet on NEA 17, which is targeting $3.6 billion.

Public pensions have piled into New Enterprise Associate’s newest fund, which is targeting $3.6 billion. They have committed $885 million, or about 25 percent percent, of NEA 17, according to data gathered by Private Equity International, an affiliate of Venture Capital Journal.

It isn’t clear when NEA plans to hold a final close on the fund, its largest to date, which it began to formally raise in March.

The latest public pension to back the vehicle is Alaska Permanent Fund, which committed $30 million. Over the last two years, the $65.63 billion sovereign wealth fund has also agreed to write checks to several other large late-stage and growth equity funds, including making a $40 million commitment to $4.9 billion Summit Partners’ tenth fund, a $27 million commitment to Index Ventures’ $1 billion sixth growth fund, and a $200 million commitment to Sequoia’s $8 billion third growth fund.

The largest public backer of NEA’s latest megafund is the California State Teacher’s Retirement System, which committed $225 million to the fund. Other LPs with sizable contributions to NEA 17 include Teachers Retirement System of Texas, Tennessee Consolidated Retirement System and Texas County and District Retirement System, with $100 million pledges each.

NEA 15, a $2.8 billion fund, is performing well. The 2015 vintage vehicle had a 23.6 percent internal rate of return as of June 2018, according to a Los Angles City Employees’ Retirement System report. The performance of Fund 15 may have contributed to LACERS’ decision to commit $35 million to NEA 17. (LACERS bet big on NEA even though its advisor recently recommended it cut back on its venture commitments.)

Other pension plans that committed to NEA’s latest fund include Los Angele Fire & Police Pension System, Nebraska Investment Council, Public School and Education Employee Retirement System of Missouri, Sacramento County Employees’ Retirement System, Teachers’ Retirement System of Lousiana, and Kansas Public Employees Retirement System. The mega-fund has also received pledges from two Taipei, Taiwan-based LPs: Cathay Life Insurance and Fubon Life Insurance.