BOSTON (Reuters) – Billionaire investor Daniel Loeb has hired a prominent tech research analyst from Goldman Sachs to reinforce the team that handles venture investments at his Third Point LLC hedge fund, sources familiar with the matter said on Tuesday.
Heath Terry, the technology, media & telecom business unit leader for Global Investment Research at Goldman, will join as a managing director at Third Point Ventures working from the firm’s New York offices. He worked at Goldman for nearly a decade.
Terry did not respond to a request for comment.
Loeb announced the hire on a call with his colleagues just hours after Third Point completed the first round of fund raising for its first-ever dedicated venture capital fund.
Third Point, which oversees $16 billion, has invested in start-ups for decades but this is the first time the firm, known for activist campaigns at companies ranging from Nestle to Yahoo, has raised a standalone venture fund.
It had hoped to raise $300 million for the new fund and is expected to exceed the target at its first close, a source said.
Terry will report to Loeb and work with Robert Schwartz, who has spearheaded venture investments at Third Point Ventures since 2000.
While Third Point has rarely mentioned the business, Loeb recently began highlighting the team’s contributions to the firm’s overall success.
“Today, we are ideally situated with a purview of both public and private markets, a long track record, a strong reputation in helping build businesses, and the rationalization of valuations in the private space,” Loeb wrote to his investors about the venture business late in 2020.
Since 2015, Third Point’s venture investments have “generated returns that place us in the top decile of 2015 venture funds,” Loeb wrote.
He pointed to investments in online lending market place Upstart and cybersecurity startup SentinelOne, where Schwartz sits on the boards, as examples of the team’s work.
Looking ahead, Loeb said in the same letter that even though there may be some later stage investments, the bulk of the team’s work will concentrate on Series B expansion stage opportunities in building a venture into a company and sitting on its board.
While venture investing has long been part of the DNA at investment firms Tiger Global and Coatue Management, some hedge fund clients have objected to the long lock-ups and preferred their managers to focus on public company investments.
That reluctance may now be ebbing, giving managers like Loeb an opportunity to dig deeper into the sector to create new sources of return.
Third Point’s Third Point Offshore Fund finished 2020 up 20.6%, its best return since 2013, when it gained 26%. In the first two months of 2021, it gained 4.1%.
(Reporting by Svea Herbst-Bayliss, Editing by Franklin Paul and Dan Grebler)