The venture arm of private-equity firm Carlyle Group has raised a $605 million fund to invest in later-stage deals and buyouts, despite poor performance so far on its prior fund.
Carlyle expects to invest $20 million to $30 million in companies that are mature and producing revenue, according to a piece in the WSJ (subscription required).
For a venture arm to be making late-stage and buyout investments, however, suggests a somewhat scattered approach. Carlyle also said it expects to contribute around $20 million to $60 million to buyouts as large as $200 million in overall size, leveraging them with debt.
Carlyle hasn’t done very well. It raised $600 million in 2001, and so began investing during the low-point after the Internet Bubble burst, which should have let it avoid the big drop off in values that happened to investments made before 2001. However, as of March 31, California Public Employees’ Retirement System reports that the fund has generated a net IRR of only 2.7 percent. Despite six years of waiting, investors have only gotten a 1.10x investment multiple.