Saints Captial raises secondary fund

Saints Captial raises secondary funds

Jan 28, 2010, 10:21am PST
Mark Calvey

Saints Capital expanded staff in Europe and promoted two in San Francisco as it takes advantage of venture capitalists selling stakes in their portfolio companies in the secondary market.

Saints, with $1 billion in capital under management and investments in 200 companies, hired Niko von Huetz as director of European investments. He’s based at Saints’ London office, which was established a year ago.

“Niko’s venture and investment experience in Europe, coupled with his knowledge in the software, communications and Internet services sector, make him a great addition to our team,” said Ken Sawyer, a managing director at Saints.

The firm has 27 percent of its assets invested in Europe, where it acquired interests in 10 companies in 2008 from Innovacom, an early-stage investor in Paris.

Saints also promoted Dr. Zack Scott to vice president and Mike Boggs to senior associate. Both men, based in San Francisco, focus on evaluating secondary investment opportunities in health care. Scott came to Saints in 2008 from Burrill & Co., a life sciences merchant bank in San Francisco. Boggs joined Saints in 2007 from RBC Capital Markets.

Secondary investments are a rare bright spot in private equity.

“Fund-raising for secondary investment funds not only set a record last year, it was the only area of private equity fund-raising to rise in 2009,” said Kelly DePonte, a partner at Probitas Partners, a San Francisco firm that advises institutional investors on their venture and private equity investments.

In 2009, secondary funds raised $23.3 billion, DePonte said, adding that firms focused on the secondary market are seeking to raise $26 billion this year.

San Francisco firms focused on secondary investments include Industry Ventures and Lake Street Capital.
Large funds have been raised by firms in New York and Europe, including a $5.5 billion secondary fund raised last year by Goldman Sachs. Transaction volume is rising in the secondary market as more buyers and sellers get closer on price.
“A lot of sellers had sticker shock early last year when getting prices on the secondary market,” DePonte said.