Ebb & Flow

While holiday shoppers do their best to melt their credit cards this season, look for MPM Capital to take a measured approach to spending its new $900 million fund, which closed last week. Mindful that the IPO window is non-existent, investors in the fund asked that the firm not commit the money any faster than three years, according to General Partner Luke Evnin.

In contrast, MPM was quick to invest its second fund - BioVentures II. It took only 25 months to fully invest that $600 million. "Because we invested BioVentures II so quickly, if we followed suit with fund III and the markets didn't open up, then we'd have two whole portfolios in illiquid markets, and that requires a heavy amount of work," Evnin said. Taking a slower pace with the new fund would allow many of the previous investments to mature, and thus require less fund oversight...