PALO ALTO, Calif. – Communications Ventures at press time was slated to wrap its fourth fund – its third in two years – on $250 million. The firm also shortened its name to Com Ventures, in part to reflect a growing interest in Internet investments, said General Partner Roland Van der Meer.
Com Ventures IV had targeted $200 million and was raised over the summer, he said. Like the firm’s preceding funds, the new vehicle will back early-stage communications and networking companies, as well as Internet deals, Van der Meer said.
The fund will be overseen by Cliff Higgerson, David Helfrich, and Van der Meer – plus E*Trade’s Michael Rolnick, who was slated to join the firm as a partner in late October.
Rolnick was vice-president for new ventures at E*Trade for about two years, working on a variety of assignments including mergers and acquisitions, internal business development and venture capital, and he met Higgerson when both attended board meetings for Digital Island, a mutual portfolio company.
Rolnick said he was attracted to ComVentures because of the opportunity to work full-time on venture capital rather than handling VC as one of several duties, as he did at E*Trade. A call to E*Trade inquiring whether Rolnick would be replaced was not returned by press time.
Higgerson and Van der Meer raised the $13 million Communications Ventures I in 1987, and the two went their separate ways in the venture world as the communications sector fell somewhat out of favor (VCJ, October 1997, page 5). A decade later, they raised Communications Ventures II, a $75 million vehicle that wrapped in fall 1998 on $12 million (VCJ, November 1997, page 18).
Fund II’s capital already will be returned by one deal, the sale of Monterey Networks Inc., Van der Meer said. Cisco Systems Inc. bought Monterey in August for stock worth about $500 million.
A Fund III portfolio company Van der Meer declined to name was slated for an IPO in the near future, which is expected to return one to two times the capital of that vehicle, Van der Meer said.
The firm raised the carry on its new fund to 25% with a hurdle rate from 20% on previous vehicles, said Van der Meer, who declined to describe the hurdle’s structure.