Texas Municipal re-ups with Updata, closes year with $457 mln in PE commitments

  • Assets under management: $29.13 bln
  • PE target: 5 pct
  • PE allocation: 1.61 pct
  • Whom to contactChristopher Schelling, director, private equity (cschelling@tmrs.com)
  • Why this is important: The LP made its last PE commitment for 2018

Texas Municipal Retirement System at its Dec. 6 meeting re-upped $50 million to Updata Partners’ sixth fund, targeting $300 million.

The pension system, which started its PE program in late 2015, committed $457 million to 10 PE funds, 8.6 percent under its $500 million pacing for 2018.

Eight commitments were re-ups while CapVest Partners and Main Post Partners were new relationships for the pension system this year.

Updata, Washington, changed its strategy from its third fund, pivoting from venture to business-software growth equity, a Texas Municipal presentation said.

The firm invests in B2B software and software-enabled services sectors outside the traditional Silicon Valley ecosystem.

Updata’s sixth fund will invest $10 million to $35 million in about 15 companies that generate revenue between $5 million and $50 million, the presentation said.

Texas Municipal invested $50 million in Updata’s fifth fund, which closed on $280 million in 2016, pension documents said.

California Public Employees’ Retirement System and University of California have also backed Updata funds.

Updata’s investments included Toronto-based Uberflip, Ruby Receptionists of Portland, Oregon, Storyblocks, Arlington, Texas, and Atlanta-based Bridge2 Solutions.

It led the $25 million funding round for Glassbox, a digital customer management platform, in October.

Texas Municipal’s PE portfolio included buyouts (55 percent), growth (22 percent) and special situations (23 percent).

The PE portfolio returned 45.04 percent for one year ended Sept 30, 2018.

Action Item: Read more on Texas Municipal’s strategy here: https://bit.ly/2DOarUt