Technology Crossover Ventures holds $2.5bn close for ninth fund

The firm held a first close in Q1 2016 having raised the majority of the capital towards the $2.25bn target and subsequently allowed for a number of additional investors to top up the vehicle.

Nathan Sanders, TCV's general partner and head of IR, told unquote" the firm had made a conscious effort to offer its LPs continuity from previous funds and TCV IX features similar terms and conditions as a result. The vehicle roughly follows the industry standard 2-8-20 model, with a 10-year lifespan and potential extensions.

The VC declined to share specific return targets for TCV IX, but said it would target the same return level as its previous vehicles. TCV did not use a placement agent in its fundraising efforts. Headquartered in Silicon Valley, the firm has additional offices in New York and London.

Investments
Following the remit of previous vehicles, TCV IX will have no minimum investment size and will be able to commit as much as $250m per equity ticket, with the opportunity to selectively go above that size.

The fund will seek to take both minority and controlling stakes in its targets, according to John Rosenberg, general partner and head of TCV's European office. He said the fund will also be able to invest in public equities where appropriate, as well as partner with other VCs and PE firms for investments.

TCV IX will seek to invest in technology companies with substantial growth potential. Rosenberg said the fund's sectoral focus will cover internet, digital media and e-commerce; enterprise software and technology services - including fintech and technology-enabled business services; and infrastructure such as networking, chips, telecoms systems and storage. Within those sectors, TCV IX will take a more granular look to identify themes and trends it believes will drive growth over a 10-year period and pursue these elements within sector-focused teams, Rosenberg said.

The fund will offer co-investment opportunities to its LPs.

Investors
TCV's latest fund had no hard minimum subscription and saw a "healthy" GP capital commitment, according to Sanders.

The vast majority of capital for TCV IX was raised from existing LPs, though there was also capacity to add a handful of new investors to the investor base, Sanders said.

He added that the result of being founded in the US 21 years ago meant the majority of its LPs that have continued to invest are US-based and the fund's geographical spread of LPs continues to be weighted substantially towards North America, with a smaller number of European backers.

TCV IX features capital from a mix of institutional investors, including family offices, pension funds and endowments, as well as high net-worth individuals - which are often people involved in the tech industry and in some cases founded a TCV-backed company.

People
Technology Crossover Ventures – John Rosenberg (general partner, head of Europe); Nathan Sanders (head of IR, general partner).

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