Venture giant Insight Partners shockingly turned down a commitment for its latest flagship fund from Pennsylvania Public School Employees’ Retirement System, the Philadelphia Inquirer reported.
PA Schools’ planned commitment to Insight Partners XIII has been controversial since it was initially discussed this past winter. In June, the PA Schools board voted 8-6 in favour of making a $130 million commitment to Insight XIII, a rare split vote from a public pension system board on an investment staff recommendation, affiliate title Buyouts reported.
The Inquirer reported that Insight Partners decided to turn down the $130 million commitment from PA Schools in recent weeks. Insight did not return a request for comment.
According to the Inquirer, Insight’s decision to withdraw PA Schools’ commitment came after Pennsylvania Governor Josh Shapiro asked the $67.6 billion system’s board chair to hold another vote on the commitment.
At the 9 June meeting, Pennsylvania Treasurer Stacy Garrity cited poor performance of past Insight funds and the manager’s past investment in failed cryptocurrency brokerage FTX as reasons she voted against the commitment.
The US Securities and Exchange Commission fined Insight Partners $1.5 million on 20 June for overcharging fees and failing to disclose fee calculations, according to a statement from the agency.
PA Schools’ debate over Insight XIII began in December, when a recommendation from the system’s investment staff was pulled from the investment committee’s agenda.
PA Schools previously made commitments to Insight Partners X, XI, XII and a related buyout annex vehicle, according to system documents.
Fund XIII has a $17 billion target, not much larger than its predecessor, Buyouts reported.
According to PA Schools’ consultant Aksia, Insight plans on investing in at least 150 software companies, most of them based in North America, with check sizes ranging between $15 million and $500 million.