General Catalyst Said to Seek $600 Million for New Fund

General Catalyst Partners, the venture-capital firm co-founded by Joel Cutler, is targeting $600 million for its next fund that will invest in technology companies, said two people familiar with the situation.

General Catalyst Group VII LP is seeking more capital than the firm’s prior vehicle, which raised $500 million in December 2011. The new fund will stick to the same kind of deals, investing in consumer Internet, social media and other technology businesses, said one of the people, who asked not to be identified because the information isn’t public.

The firm, based in Cambridge, Massachusetts, is entering a competitive fundraising market as private-equity investors reduce the number of managers they use in an effort to improve returns. General Catalyst, which makes both early-stage and growth investments, expects a December close for the fund, according to one of the people.

Michelle Daubar, a spokeswoman for the firm, didn’t respond to a phone call and e-mailed request for comment.

Since its founding in 1999, the firm has raised six funds with a total of $2.2 billion in committed capital. It has invested in companies including ProfitLogic Inc., which was sold to Oracle Corp. in 2005; GroupMe Inc., which was bought by Skype Technologies SA; and Jumptap Inc., which is being purchased by Millennial Media Inc. in a deal announced in August.

Kayak Software

General Catalyst backed travel website operator Kayak Software Corp., which raised more than it sought in its July 2012 initial public offering and was acquired this May by Priceline.com Inc. for about $1.8 billion. General Catalyst first invested in Norwalk, Connecticut-based Kayak from its third fund in 2004, with additional investments from its fifth fund and a supplemental vehicle in 2007.

Last year, the firm saw some of its companies go public, including Brightcove Inc., a provider of cloud-based video hosting and publishing services, and Demandware Inc., which offers an e-commerce platform. General Catalyst-backed Mascoma Corp., a biofuel company, withdrew its registration for a planned IPO earlier this year.

Fund VI was generating a value multiple of 0.85 as of the end of 2012, according to data from New Jersey Division of Investment, an investor.

To contact the reporter on this story: Sabrina Willmer in New York at swillmer2@bloomberg.net

To contact the editors responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net; Jennifer Rossa at jrossa@bloomberg.net

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