Jeff Leeds' fund gets off the ground

Former Lazard banker Jeffrey Leeds was on his way to New York's JFK airport with ex­Massachusetts governor William Weld when terrorists struck the World Trade Center on September 11, 2001. The pair were about to embark on a trip to raise money for a second buyout fund for Leeds Weld & Co., their now-12-year-old private equity firm. They never took off, and neither did the new fund.

Subsequently, Leeds Weld concentrated on maximizing the returns of its existing investments, which have been primarily in the education, training and information services sectors. Among their big hits: a ninefold profit on Datamark, a provider of management services to colleges, and a fivefold gain on Caribbean medical school Ross University. In 2003 the firm, which counts former New York mayor Rudolph Giuliani as its advisory board chairman, resumed fundraising. Last month it finally closed the new fund at $450 million -- almost triple the size of its first, $160 million pool.

"We didn't get spun out of another firm, and it's tough to break in when you don't have prior relationships," says Leeds, who served as a clerk to U.S. Supreme Court Justice William Brennan when he was in his 20s. Today Leeds Weld's 20 institutional limited partners include the Archdiocese of New York, CalPERS, General Electric Co.'s pension fund and the Teachers' Retirement System of the City of New York. "We're pleased to have this behind us and to have capital to put to work," says Leeds. "We see some real strategic opportunities."