UK venture capital firm DFJ Esprit has closed two funds with a combined size of €337m as it looks to invest not only in new deals but also move into the venture secondaries market.
The primary fund, DFJ Esprit III, has raised €150m for investment in early and late stage technology companies across Europe. Backers include the European Investment Fund, Finnish Industry Investors, Partners Group, JP Morgan, LGT Group and HarbourVest.
The fund raising comes a little over a year since Esprit’s second fund received a US$50m investment from secondaries giant Coller Capital, giving the fund an investment capacity of approximately €70m. The firm’s first fund, the US$500m DFJ Esprit I, was acquired from Cazenove in 2006 when Cazenove Private Equity and Prelude Ventures merged to form what was then called Esprit Capital Partners.
The second fund is the first fund of Esprit’s new venture secondaries division, Encore Ventures. Led by Charles Cameron and Brian Robertson, €190m has been raised for investment in venture capital portfolios, and has opened its account through the purchase of 3i’s European VC portfolio alongside Coller and Harbourvest.
It is the first venture secondaries fund to close since summer 2008, when Shackleton Ventures raised £25m for it second fund, and which also made its first investment by acquiring a 13-strong portfolio from 3i.
Venture secondaries have slowly been moving into the mainstream over the last few years, with established secondaries firms, like Cipio Partners, San Francisco-based Saints Capital, Industry Ventures, Lake Street Capital, London-based Pantheon Ventures and Paul Capital, buying VC portfolios, and new houses emerging to snap up positions like Azini Capital, Tempo Capital Partners, and the aforementioned Shackleton.