Greenspring closes VC secondaries fund on $800m

The venture capital secondaries vehicle, launched by the $10bn investment venture capital platform Greenspring, targets venture capital investments globally, buying stakes in venture funds and direct stakes in venture-backed companies.

Founded in 2000, Greenspring has invested in secondary opportunities since its inception, being involved in more than 175 transactions as of September 2019.

Private equity fund secondaries command the biggest market in the alternatives space, but there have been dedicated secondaries strategies for venture for some years, though it remains a relatively small part of the market. According to Campbell Lutyens, the transacted value of venture secondaries amounted to $5.67bn in 2018, compared with the $47.4bn in buyout secondaries.

In Unquote's secondaries report, written in conjunction with Campbell Lutyens last year, those interviewed said that investing in venture via secondaries has specific challenges: there is generally less certainty around valuations and the timing of exits, so IRRs tend to be more volatile. Secondly, it can take longer to exit the companies, and follow-on capital injections may be needed, depending on the stage an investor is exposed to. Finally, it can be difficult for managers to deploy a meaningful amount of cash. The issue around deployment is exacerbated by difficulties in finding attractive opportunities in the space, particularly when looking at a portfolio of fund interests.

Investors
The Metropolitan Government of Nashville and Davidson County has backed Greenspring Secondaries Fund IV.

Among the LPs that committed to the fund's predecessors is Baltimore Fire & Police Employees' Retirement System, which has backed Greenspring Secondaries Fund I, Greenspring Secondaries Fund II and Greenspring Secondaries Fund III.

Investments
Greenspring Secondaries Fund IV targets investments in expansion-stage companies, as well as limited partner interests in venture capital funds, primarily via secondary transactions.

People
Greenspring Associates – Eric Thompson (chief operating officer).

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• Topics
• Funds
• Secondaries
• Venture
• Secondaries