The San Mateo, Calif.-based firm expects to hold a final close on $520 million within the next few weeks, including up to a $20 million general partner commitment.
Bertram launched its fund-raising drive in March with a $500 million target. The firm had planned to begin marketing in early 2009, but held off as smaller deal sizes allowed it to lengthen the investment runway of its $350 million first fund.
“Everything we’re buying right now is substantially under 5x EBITDA, but we originally forecasted paying 8x EBITDA or more,” Bertram Managing Director Jeff Drazan said at the time. “[Canadian publisher] Trafford is a good example. It’s a $10 million business we’re buying for a couple hundred thousand… I just don’t feel we can go out until fund I is 75% committed, and we’re just not there yet.”
Bertram’s first fund is now mostly committed, and the expectation is that the second fund will add its first portfolio company within the next two months. Through the end of 2009, the California Public Employees’ Retirement System reported that Bertram’s first fund had an IRR of 18.4%, albeit without any distributions.
Drazan declined to comment on the current fund-raising process.
The limited partners in the second fund are unknown, but prior backers include financial institutions, fund of funds, university endowments and corporate pension funds from North America and Europe, including CalPERS, John D. and Catherine T. MacArthur Foundation, Los Angeles County Employees Retirement Association and Neuberger Berman Private Equity Partners.
Drazan, a former managing director at Sierra Ventures, and his brother Ken Drazan launched the firm in 2006. —Dan Primack