New York-based investment firm StepStone Group Inc., advised by Proskauer Rose LLP, has clinched its latest venture capital secondaries fund after securing $3.3 billion from investors, marking the largest fund dedicated exclusively to pursuing venture capital secondaries to date.

StepStone Clinches $3.3B VC Secondaries Fund : Oversubscribed Fund Details

The oversubscribed fund, dubbed StepStone VC Secondaries Fund VI LP, received support from both existing investors and new limited partners, the investment firm announced in a statement on Wednesday. This achievement underscores the significant interest and confidence investors have in StepStone's strategy and market positioning.

Fund Objectives and Strategy

The fund aims to provide liquidity to founders and early investors in venture-backed companies, buy interests in venture capital funds from limited partners, and assist fund managers with structured solutions such as portfolio strip sales, tenders, and continuation funds. These strategic moves are designed to cater to the growing need for interim liquidity in the venture capital market.

"We believe we are well positioned to effectively diligence, price, and structure a broad range of secondary opportunities," StepStone partner Hunter Somerville said. "We are humbled by the support of new and existing investors in the fund. We look forward to executing on our mission of seeking strong returns by financing innovation."

StepStone Clinches $3.3B VC Secondaries Fund : Venture Capital Market Growth

The fundraising comes amid a booming venture capital market. When StepStone debuted its inaugural venture capital secondaries fund in 2014, there was approximately $600 billion in assets under management in the venture capital arena, StepStone said in its statement, citing data from Pitchbook. By the end of 2023, that figure had soared to roughly $3.3 trillion.

"The traditional view is that venture capital is a cradle-to-grave industry where the only exit opportunities come from a full acquisition or IPO," StepStone partner John Avirett said. "With exit timelines extending by several years and trillions of dollars locked up in illiquid private companies, that mindset is starting to change. Shareholders of venture-backed companies, limited partners, and fund managers are increasingly turning to the secondary market as a tool for interim liquidity."

StepStone's Investment Portfolio

StepStone primarily invests in private equity, infrastructure, private debt, and real estate. Its clients include public and private defined benefit and defined contribution pension funds, sovereign wealth funds and insurance companies, endowments, foundations, family offices, and private wealth clients. As of March 31, StepStone was responsible for approximately $678 billion of total capital, including $157 billion of assets under management.

StepStone Clinches $3.3B VC Secondaries Fund : Proskauer's Legal Guidance

The Proskauer team advising StepStone was led by partners Sarah Cherry, Kerry Fitzgerald Shriver, Galen Lewis, Jeremy Naylor, and Adam Scoll, providing crucial legal support to ensure the successful closing of StepStone VC Secondaries Fund VI LP.