Post-Facebook, Accel Is Investing a Lot, Exiting a Bit

Facebook's share prices are seen inside the NASDAQ Marketsite in New York

Sometimes it’s hard to remember that Accel Partners has done other things besides back Facebook.

The firm made so much from that one investment that limited partners in the fund that backed it stand to reap among the largest returns in venture history.  Even with Facebook’s plummeting post-IPO stock price, Accel’s 10.7% stake the company, which it secured primarily with a $12 million investment in 2006, was still worth more than $4 billion as of late last week.

But truth is, most of Accel’s limited partners won’t profit from the Facebook investment. That’s because only a handful actually invested in Accel IX, the $400 million 2004 vintage fund that backed the social network. The vast majority of the money Accel has under management comes from later vintage funds.

So how are those funds doing? Overall, it’s too early to make any definitive judgment, as the bulk of the more than $3 billion it has under management comes from funds raised in 2008 or later, which makes for a fairly immature portfolio by venture standards. Two vehicles – the Accel Big Data Fund and Accel Growth Fund II – just closed in 2011.

Still, it’s intriguing to take a peak under the hood to see what other big hits Accel has had or stands to generate from its current portfolio.

Over the past year, at least five portfolio companies have gone public in the past year. Of those, the largest is Groupon, in which Accel has a stake of just over 5 percent. While the daily deals provider’s current market capitalization of $3 billion is way down from its peak valuation, Accel still stands to win on that one, having come in as an early stage investor.  The firm also owns about 13% of online travel provider Kayak Software – a stake worth about $140 million at recent share prices.

VCJ subscribers can read more and see a table of recent Accel exits by clicking here.

On the M&A front, Accel’s performance is more difficult to gauge. The firm declined to respond to questions for this story, including ones about returns from recently acquired portfolio companies. Still, it appears that several provided a positive outcome. One was Amobee, a provider of mobile advertising services that raised early and later stage capital from Accel.

So how does the road ahead look? My broad take is as follows: Accel, already one of the older and better-known Silicon Valley venture firms, got a major reputation boost from its investment in Facebook. This helped to raise a lot of money for for more recent generalist and specialist funds. Since then, Accel has been investing like crazy – backing something like 68 rounds this year, according to the Thomson Reuters database- which often misses smaller seed rounds.

Photo of Facebook’s share price the day of its IPO from Reuters.