Florida Warms Up to Venture Capital

Joining a growing list of institutional investors to make first-time commitments to venture capital funds, the Florida State Board of Administration (FSBA) voted last week to develop a $300 million venture capital program.

Since January, a handful of new investors – Indiana State Teachers’ Retirement System, Missouri Public School Employees’ Retirement System, San Bernardino County Employees’ Retirement System and the State of Illinois among them – have flooded the sector with $1 billion of new investment capital.

Although it has not yet outlined an investment strategy, the $106 billion Tallahassee-based public pension fund says it wants access to top-quartile venture capital firms and wants to achieve the best long-term, risk-adjusted IRRs. It has initiated a search for fund-of-fund managers. The RFP process will close Dec. 16.

The FSBA would not comment on its new initiative.

The FSBA made its first commitment to a private equity fund in 1998. Since then, ithas carved out stakes in at least a half dozen buyout shops: Apollo Advisors; The Carlyle Group; Hicks, Muse Tate & Furst; Leonard Green & Partners; Liberty Partners and Thomas H. Lee Co. It has never previously invested in a venture capital fund.

Last year, the FSBA upped its private equity allocation to 4% – an increase of 1.5%. The FSBA’s private equity portfolio is currently valued at $2.9 billion.

Contact Carolina Braunschweig