Austin Nears Close of Fund IX

Austin Ventures has received $525 million in verbal commitments for its ninth fund, and is holding a series of rolling closes to accommodate the different schedules of its limited partners.

The strategy is not different from earlier Austin fund-raising efforts, although the firm had said in early March that it was hoping to hold a final close by the end of Q1. That self-imposed deadline has been moved back to early May, with about $110 million worth of commitments still needing to be formalized. The firm has officially closed on about $416 million, according to a recent regulatory filing.

As reported earlier (see PE Week, 3/28/05), Austin will not accept commitments from public pension systems in Texas, due to possible disclosure requirements. That decision was prompted by increased concerns over the interpretation of open records laws by Texas AG Greg Abbott, whose office has confirmed that he supports the disclosure of underlying asset information, such as portfolio company valuations and revenue streams.

As a result, Austin has barred from fund IX such past backers as the University of Texas Investment Management Co. (UTIMCO), the Teachers’ Retirement System of Texas (TRS) and the Houston Officers’ Pension System.

The firm is, however, accepting LP commitments from public pensions in Pennsylvania, Washington, Virginia and Michigan. Austin has accepted investment from the Massachusetts Pension Reserves Investment Management Board. Austin Ventures closed its previous fund with $1.5 billion in 2001, but later reduced its size to $830 million.