Late-stage VC Meritech hits market with fifth fund


shutterstock_106520849

Meritech Capital Partners, a late-stage investor, is back in the market raising its fifth fund, according to two limited partners with knowledge of the fundraising.

The Pennsylvania State Employees’ Retirement System made a $25 million commitment to the Meritech fund earlier this month, according to an investment summary from the pension system.

The exact target on Fund V is unclear, though the two LPs said the firm is targeting somewhere in the range of the last fund. One of the LPs said Meritech could target up to $475 million. Meritech closed its Fund IV on $425 million in 2011.

Meritech, based in Palo Alto, Calif., did not return two calls for comment this week.

Fund IV was generating a 21.3 percent internal rate of return and a 1.28x multiple as of Sept. 30, 2013, according to performance information from the California Public Employees’ Retirement System.

Fund III, a $400 million vehicle raised in 2005, has performed even better than its successor. PennSERS, which committed $35 million to Fund III, reported that it had received $122.5 million in cumulative distributions as of Dec. 31. (Meritech has drawn down $34.4 million of PennSERS’ committed capital.)

Fund II, a $738.71 vehicle raised in 2000, was generating a 1.57x multiple as of March 31, 2013, according to Bison, which tracks fund performance from public LPs.

Performance data were unavailable for Meritech’s debut fund, which raised $1.1 billion in 1999.

Photo courtesy of ShutterStock: http://www.shutterstock.com/gallery-730744p1.html

Connect with your peers at the 9th Annual PartnerConnect West in San Francisco on September 27–28.

Sign up to our Newsletter

Receive updates from our PE HUB Wire and Top Stories of the Week newsletters:

We will not send you spam, and we don't share your email address with 3rd parties.