Vista blows out target with $1.1 bln final close on small-cap fund

Vista Equity Partners has closed its second Foundation Fund, which invests in small and mid-cap software companies, on $1.1 billion.

The total includes $1 billion in commitments from limited partners, and a $100 million GP commitment, according to Robert Smith, chairman and chief executive officer of Vista Equity Partners. Foundation Fund II officially closed on October 31, 2013.

Foundation Fund II had an initial target of $500 million and held a first close on $525 million earlier this year. Fund II, like Vista’s flagship fourth fund which closed on $3.5 billion in 2012, would pay out a 30 percent carried interest rate if the fund returns 3x, Smith said.

The first Foundation fund raised $400 million in 2010. Foundation Fund 1 was generating an 18.1 percent internal rate of return and a 1.4x multiple as of March 31, 2013, according to performance information from the California Public Employees’ Retirement System.

Vista also is out in the market raising its debut debt fund, targeting $600 million. The debt fund has held a first close, though it’s not clear on how much.

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