Eyeing a wealth of wireless and Internet infrastructure opportunities both at home and abroad, Trident Capital recently capped its fifth fund at $725 million.
Originally targeted at between $500 million and $750 million when the firm began raising the vehicle last summer, Trident Capital Fund V held its initial close back in January with $650 million.
Fund V’s focus will be mostly early-stage plays in the Internet infrastructure, business-to-business and wireless Internet spaces. In order to maximize its exposure to wireless Internet investments, Trident also recently inked a joint venture agreement with the Finnish National Fund for Research and Development (Sitra), which also happens to be a limited partner in Fund V.
With the rapid advancement of wireless technologies in Finland and Sweden, which has been spurred by the close proximity and influence of wireless behemoths Nokia Corp. and Ericsson, it’s an ideal time to invest in those regions, said Don Dixon, a managing director with Trident in a February interview with Buyouts’ sister publication Venture Capital Journal.
While no more than 10% of the fund’s capital has been allocated for offshore investments, Dixon said that he believed Sitra could help carve inroads for Trident abroad to improve its access to people with a proven ability to turn a profit from wireless technologies.
Historically, Trident has been stage-independent, depending on the state of the market. Fund I, vintaged in 1994, was a late-stage and leveraged buyout vehicle, but the more recent Fund III and Fund IV have had more early-stage bets. In the past, average investment sizes have run the gamut from $250,000 to $20 million, and Fund V isn’t likely to stray from that formula, Dixon said.
Fund V’s first six investments are all early-stage plays, but Dixon said that could change, as he expected the firm would participate in a few LBOs later in the fund’s life, as well as some public-company financings if such transactions come back into vogue.
The fund’s portfolio already includes Finland-based Add2phone Ltd., strategy consulting firm Strategis Information Systems Inc., Stockholm-based Mgage Systems AB, Thinking Investments of Boston, Qualsys Inc. and Mobyson AB, also based in Stockholm.
Additionally, Dixon also said he expected Fund V to have a three-to-five-year investment window, which is much longer than that of more recent vehicles.
In addition to Sitra, the lead LPs on the fund are investing subsidiaries of NIB Capital NV and General Motors Corp. Other LPs include Liberty Mutual Group, Northrop Grumman Corp., clients of Abbott Capital Management, Thomas Weisel Partners, Massachusetts Pension Reserves Investment Management Board, an endowment representing Princeton University, and several undisclosed wealthy individuals.
Trident has 10 investing partners with offices in Palo Alto, Calif., Los Angeles, Chicago and Westport, Conn.