The University of Texas Investment Management Company continues to put big money behind emerging managers in venture capital, steering a course that has brought handsome returns over the past decade.
The strategy is more-of-the-same for the Texas money manager, which backed some of the earliest funds from such firms as Union Square Ventures, Foundry Group and Spark Capital at a time when such bets were perceived as risky.
In the past two years, the LP has re-upped or invested for the first time with True Ventures, Union Square, Foundry, IA Ventures, Mosaic Ventures and Upfront Ventures, according to a recent portfolio report. Many of these firms delivered on earlier funds and as a result received substantial new commitments.
Among the commitments is a $40 million investment each with 2014 True Ventures IV and True Ventures Select I, a $45 million investment in Foundry Group 2016, a $45 million commitment to the 2015 IA Ventures Strategies Fund III and a $40 million investment in Upfront V, the report shows.
Union Square Ventures received $20.6 million each for its 2014 early-stage fund and its 2014 opportunity fund.
As a result, emerging managers make up the majority of the 13 funds UTIMCO joined in 2014 and 2015. And they have crafted a portfolio for the two vintage years that favors smaller early stage funds.
While the portfolio is young and still making initial investments, two funds stand out. At the top of the list so far is GGV Capital V, which as of August 2015 posted an IRR of 48.54 percent, a big advance in the previous nine months.
True Ventures IV also is off to a good start with an IRR of 18.79 percent as of August, the report shows.
The full list of 13 funds is available in the accompanying table with commitments, distributions and IRRs.