Top Tier eyes secondaries via debut of dedicated Europe fund of funds

The fundraise is part of total capital commitments of $1.5bn across the most recent series in the firm's family of funds.

Top Tier Capital Partners will dedicate up to one-fourth of its first dedicated Europe-focused fund of funds toward secondaries and co-investments, as reported by affiliate title Secondaries Investor.

The San-Francisco-based firm collected nearly €260 million in capital commitments for Top Tier European Venture Capital Fund in a final close, surpassing its €250 million target, according to a statement.

The fund, based in Luxembourg, is focused on European funds, with some investments in Israel. Sectors include niche-focused venture funds and high-growth, expansion-stage tech start-ups, according to the statement.

VC LP Venture Fund
David York, Top Tier Capital Partners

The fund will invest between 20 and 25 percent in secondaries and co-investments, David York, managing director and founder of Top Tier, told Secondaries Investor. However, there is not a hard and fast rule, he added, and the fund will invest at the team’s discretion.

The existing dedicated secondaries and co-investment vehicle Top Tier Venture Velocity Fund III seeks global opportunities and has already invested a fair amount in Europe, according to York, who noted there are undercapitalized and underappreciated venture assets in that market.

The global and Europe funds will invest alongside each other, with the European fund receiving priority on European deals.

The same team evaluates opportunities for both funds, York said.

Last October the firm raised $300 million for Top Tier Venture Velocity Fund III, which invests through secondaries and co-investments, according to PEI data.

That brings the total haul to nearly $1.5 billion across the European fund, its secondaries- and co-investment-focused Velocity fund, Top Tier Venture Capital IX, and related SMAs, according to the statement.

Fully 28 percent of the underlying funds that traded in the secondaries market last year were in Europe, according to Campbell Lutyens’ 2021 Secondaries Market Overview. Venture capital accounted for 7 percent of funds traded globally, up 2 percentage points from the year before.

Top Tier opened a London office in 2019 and has made venture investments in the region since 2005, according to the statement.