Tech buyouts are taking off after a couple of solid exits such as Vector Capital’s more than 10x return on LanDesk and Silver Lake Partners’ successful Seagate (NYSE: STX) IPO. One expert says there are 20 such funds in the market right now.
Most notably, Silver Lake Partners is said to be raising a $750 million fund aimed at the mid-market, as well as a $1.5 billion fund for larger deals. Silver Lake raised its last fund, $3.6 billion Silver Lake Partners II, in 2004. Its first fund, vintage 1999, returned 23.7%, according to CalPERS, an LP in the fund. Its second fund has an IRR of .2%, according to CalPERS.
Meanwhile, Garnett & Helfrich is trying to raise a second fund of $750 million. It raised a first fund of $250 million in 2004 and then added another $100 million in September 2005. It will be interesting to see if G&H can raise a second fund without any realizations from its first. Thomson Financial (publisher of PE Week) shows that the firm has made three investments to date: Blade Network Technologies, Wyse Technology and Celunite.