Globespan Capital ready to wrangle a sixth fund

Globespan Capital Partners is beginning to talk with its limited partners about raising a new fund, which will be smaller than the $400 million fifth fund it raised in 2006, PE Week has learned.

The Boston-based firm is pursuing a smaller fund target because some of its limited partners have dropped out of the venture capital asset class, according to a source familiar with the situation. Although no definitive target date has been set on the launch of the fund, the firm may hold a first close before the end of the year.

Globespan CFO Mary Bevelock declined to comment about firm fundraising, citing Securities and Exchange Commission regulations.

Previous limited partners in Globespan funds include the pension arm of E.I. DuPont De Nemours and Co., Fort Washington Capital Partners Group, INVESCO Private Capital, Itochu Corp., JAFCO Co., Mitsui & Co., Nippon Venture Capital Co., NTT Data Corp., Portfolio Advisors, The Glenmede Trust Co., Toyota Tsusho Corp., Tri-State Ventures, Wachovia Securities and A.G. Edwards Capital, according to data from CapitalIQ.

The firm has slowed its investment pace some since the financial crisis hit, according to data from CapitalIQ. Globespan Capital, which also has offices in Palo Alto, Calif., and Tokyo, backed 12 companies in 2009, down from 16 in 2008 and 20 in 2007. The firm primarily invests in early and mid-stage information technology companies, but has expanded into the alterative energy sector in recent years.

Globespan commanded a 2.5% management fee for its previous fund, according to previous documents filed with the SEC.

The favorable compensation terms may be well deserved. Globespan has done well so far in the past year, with three exits already on the books. Quattro Wireless, a provider of mobile advertising services and which had raised $28 million from investors, was bought by Apple Inc. for an undisclosed amount. Also, internet telephone company JaJah, which had raised $31.25 million from investors, was sold to Telefónica O2 for more than $200 million. The two deals netted Globespan more than $100 million, according to a source.

The firm has other successful exits in recent years. Software developer Plaxo,which had raised $24 million from investors, was sold to Comcast in May 2008 for an undisclosed price that was reported to be between $145 million and $175 million. It took datacenter automation company BladeLogic, which had raised $27 million from investors, public in July 2007 and sat on a post-IPO stake worth $95 million before the company sold to BMC in March 2008 for $890 million. Mobile billing company m-Qube, which had raised $42.4 million from investors, was bought by VeriSign for $250 million in March 2006.

Globespan may have at least one more exit teed up for this year, including the $75 million proposed IPO of data storage company GlassHouse Technologies, which has raised $64 million from investors.