Performance Equity raising VC fund

Multi-billion dollar investment firm Performance Equity Management has raised a new venture fund, PE Week has learned.

CEO Charles Froland confirmed the new fund in an email, but declined to comment on its size or any other details, citing a “quiet period.”

It is unclear what relation, if any, the new fund has to a $650 million venture fund of funds that the Greenwich, Conn.-based firm raised in 2006 and disclosed in regulatory filings.

Venture is a small part of Performance Equity’s overall activities. The firm invests both directly, backing companies with tens of millions of dollars, and indirectly through a fund of funds, which may invest up to $100 million in any given fund. The firm also invests in buyout funds and other types of private equity.

Performance Equity was founded during the summer of 2005 as a partnership between General Motors Investment Management and the private equity investors associated with the group. Performance Equity manages private equity for the GM pension plan.

Information on the firm’s direct investments is scarce. The firm helped urologic drug company Esprit Pharma raise a $90.7 million Series B during August 2006. Other investors included New Enterprise Associates, Apax Partners, Domain Associates, Montagu Newhall Global Partners and Oak Investment Partners. Performance Equity also backed network optimization company Rivulet Communications with a $20 million Series B in March 2007. Other investors included ATA Ventures, Scorpion Capital Partners and Menlo Ventures.

In terms of its fund of funds investments, Performance Equity was one of the initial investors in Spark Capital’s $260 million first fund, according to reports.

It also backed Insight Venture Partners’ $1.2 billion sixth fund, according to Buyouts, a PE Week affiliated publication.