Texas County and District Retirement System has committed $340 million to seven venture funds since the start of 2019.
The $31.9 billion retirement system has recently increased its target private equity portfolio allocation by 2 percent to an 18 percent target. Actual PE allocation was 15.2 percent as of June 30.
TCDRS’ push into venture could be related to its ramp up of PE portfolio. The Texas retirement system targets a 20 percent exposure to venture, which is about 3.6 percent of its total portfolio.
The pension plan’s largest venture commitment went to New Enterprise Associates 17th fund. The system committed $100 million to a $3.6 billion fund, which has yet to announce its closing.
Other funds added by the Texas system include those managed by such firm as Spark Capital, Lightspeed Venture Partners, DCVC, Joy Capital and Threshold Ventures, which is a rebrand of Draper Fisher Jurvestson. These are TCDRS’ repeat investments with this group of managers.
The Texas system’s 2019 commitments range in size from $30 million to $100 million.
TCDRS total PE portfolio has been producing strong results for the pension plan, returning 15.8 percent, 17.0 percent, and 13.6 percent over a one-year, three-year, and 10-year periods. The plan consistently outperformed its benchmark over the last decade.
The pension plan’s venture portfolio is headed up by Jon Shoen, managing director of private equity.
TCDRS has had a favorable view of VC asset class for almost a decade, having added as many as 10 venture funds in some years.