Big Deal in the Big Apple
Vista’s consistent returns have helped it get investment capital from pension plans and retirement funds throughout the country. In 2011, New York City Pension Funds was so impressed with the Vista team that it invested $225 million with it, one of its largest single investments with a minority-owned firm. According to the office of John C. Liu, comptroller of the city of New York, funds invested in a previous Vista fund–Vista Equity Partners III–had a rate of return of 29.4%, making it one of the city’s top performers.
Liu says that return is a solid performance considering the then turbulence of the financial markets. “Vista Equity is an emerging manager that has clearly emerged,†he says. “This is part of our ongoing effort to bring along emerging managers and give them a chance to show what they can do.â€
“We were the top performing private equity fund in their entire portfolio,†says Smith. “I expect Vista Equity Partners Fund IV is going to be one of the top performing funds in the world.â€
While that may seem like braggadocio–and it might be– the numbers don’t lie. Vista returned a little more than $2 billion to its investors in 2012 across its funds. “There are people that by their nature are just born to accomplish things and to focus on being the best,†says Joe Watson, an adviser who has worked with Smith on Smith’s philanthropic endeavors. “There are a lot of people who write books about being the best and talk about being the best, but there are people who are just born that way.â€
One of Smith’s goals is to grow the firm’s capital under management to north of $50 billion within the next decade by continuing to deliver superior returns within the enterprise software segment and by establishing new funds every three-and-a-half to four years. “I want people to view Vista as the best technology investors on the planet, period,†states Smith. “My guess is that over the next 20 years, people will come to realize that we’re actually the best technology private equity investors of our generation. The way I look at it, we have 80 wins and no losses.â€