Investments by the Florida Growth Fund program in technology and growth companies and private equity firms have provided double-digit returns and hundreds of millions of dollars for the Florida Retirement System.
The companies that received investments reported creating 17,174 jobs as of June 30, with an average annual salary of $72,116 for the jobs created in the past year, according to a newly issued report from the Florida Legislature’s Office of Program Policy Analysis and Government Accountability.
The companies and private equity funds receiving funding also reported making $208.7 million in capital investments between July 1, 2017, and June 30, 2018, bringing total capital expenditures to $754.6 million since the fund’s inception in 2009, the report from the watchdog agency said.
The Florida Growth Fund is an economic development tool that invests money from the Florida Retirement System. As of June 30, the fund had committed to invest $621.6 million in 46 technology and growth companies and 33 private equity firms. In the 12 months ended June 30, the fund boosted total commitments by $57.1 million and made seven additional investments —two of them in private equity firms and five of them in tech and growth companies, said OPPAGA, which reviews the fund annually.
With the exception of one $7.5 million investment in North Carolina, all of the fund’s investments are in Florida, including $15.2 million in growth and technology companies in Pinellas County. The fund has invested $106.2 million in both companies and private equity funds in Hillsborough County.
The specific investments are not detailed in the report.
Past investments by the fund include Triad Retail Media, a digital marketing firm in St. Petersburg that has since been acquired by WPP, the world’s largest advertising agency, and Tower Cloud, a St. Pete company that builds broadband infrastructure networks and was bought by Communications Sales & Leasing.
There are two separate funds in the program. Florida Growth Fund I, the older fund, had a grow internal rate of return of 15 percent and a net internal rate of return of 12.5 percent as of June 30. The newer fund, Florida Growth Fund II, had a gross internal rate of return of 19.9 percent and a net internal rate of return of 15.4 percent.
The fund has distributed $363.4 million to the Florida Retirement System Trust Fund since inception, OPPAGA said.
The State Board of Administration, which manages the assets of the Florida Retirement System, contracts with Hamilton Lane, a Philadelphia-based investment firm with a Miami office, to manage the Florida Growth Fund. Late last year, the SBA contracted with J.P. Morgan Asset Management as an additional fund manager in anticipation of future growth.