Fund Briefs May 18, 2015

North America

Greenspring returns to market with venture FoF

Venture capital fund of funds Greenspring Associates is back on the market with a new vehicle targeting at least $400 million, according to regulatory documents.

A Form D filing for Greenspring Global Partners VII-B LP indicates the firm is targeting approximately $400 million for its latest fund of funds. The firm appears to be raising another $50 million through three parallel vehicles.

Greenspring, which maintains offices in Maryland and Palo Alto, Calif., declined to comment on the fundraising.

Greenspring invests in high demand venture funds managed by firms such as Kleiner Perkins Caulfield Byers, Lead Edge Capital and Lightspeed Venture Partners. The fund portfolio is “weighted towards funds that are largely inaccessible to most investors given their historical outperformance and small fund sizes,” according to its website.

The firm also acquires stakes in venture funds through the secondary market and invests directly alongside existing managers, and most recently participated in New York-based human resources platform Namely’s $11 million fundraising round with True Ventures in March. Greenspring’s portfolio includes stakes in Alibaba.com, Sonos and TeamViewer.

The third and fourth generations of Greenspring Global Partners funds netted internal rates of return of 8.3 percent and 11.34 percent through March 31, according to Fort Worth Employees’ Retirement Fund documents. Fund V, a 2011 vintage fund, netted 16.94 percent and a 1.27x multiple as of Feb. 28, according to Fire and City Employees’ Retirement System of the City of Baltimore documents. –Sam Sutton

Aspect Ventures raises $150 million debut fund

Jennifer Fonstad, a former partner at DFJ, and Theresia Gouw, a former partner at Accel Ventures, announced in mid-May they had raised $150 million for their nascent venture firm, San Francisco-based Aspect Ventures.

While recognizing that gender sets them apart as founding venture partners in Silicon Valley, Fonstad said in an interview that she and Gouw wanted to be recognized for their work first.

“We are gender neutral as a firm,” she said.

Founded last year, the early-stage firm has already invested in such companies as job site The Muse, digital health marketplace Vida and child-care startup UrbanSitter. The firm specializes in companies that customers can access easily using smartphones.

Aspect said it will invest $100,000 to $500,000 for seed deals, $2 million to $5 million for Series A and will make some follow-on, or Series B investments, up to $10 million.

Fonstad and Gouw moved up by about a year their plans to seek outside institutional funds rather than use their own funds, Fonstad said, to send a message they were building a lasting firm.

“It’s certainly intended to be something beyond the founders over time,” Fonstad said. “It’s important from a discipline perspective, as well as enabling others as you bring them up through the firm, to have third-party funding.”

The pair came up with the name Aspect Ventures after a brainstorming session with Caryn Marooney, a longtime communications executive, and deciding they wanted to draw on various aspects of their experience while building their venture firm.

This story on Aspect first appeared in Reuters.com and was edited by VCJ.

Ontario government to establish C$20 mln health tech fund

The Ontario government plans to establish a new fund to support emerging health technologies in the province. The Health Technology Innovation Evaluation Fund will be capitalized at C$20 million to support pre-market evaluations and early adoption of innovations in specific care settings and across the health sector.

Separately, the provincial government announced in April that it would commit C$25 million to Scale Up Ventures Fund, an Ontario early-stage venture capital fund. –Kirk Falconer

Ontario Pension Board helps top up Northleaf Fund

Northleaf Venture Catalyst Fund, a venture fund of funds managed by Northleaf Capital Partners, has added the Ontario Pension Board to its investor base. With the new commitment from Ontario Pension Board, as well as increased commitments from BDC Capital and the Ontario government, capital committed to the Northleaf fund now totals C$264 million.

Since its initial close in January 2014, the fund has made commitments to the latest partnerships of Georgian Partners, Golden Venture Partners, Relay Ventures, Versant Ventures, Version One Ventures and XPV Capital. It has also made direct investments in Canadian startups eSentire, FreshBooks, Silanis, Vision Critical and Wattpad. –Kirk Falconer

Redpoint closes Fund VI at $400 mln

Redpoint Ventures has closed its sixth fund with $400 million in commitments. Fund VI is the same size as its previous vehicle, which closed in 2013.

Partner Satish Dharmaraj wrote in a blog post that the fund will focus on seed, Series A and Series B rounds in consumer and enterprise companies. He also noted that the firm’s investments, since 2014, have achieved four IPOs and six M&A events with a combined market cap in excess of $8 billion.

The Menlo Park, Calif.-based firm was an investor in the anonymous social media app Secret, which recently shut down. The firm also backed Zendesk, which went public last year, and RelateIQ, which Salesforce acquired in mid-2014. Current portfolio companies include Datameer, Kabam, Stripe, Twilio and Pure Storage, which was valued at $3 billion when it raised funding nearly a year ago.

The regulatory filing for Redpoint’s new fund shows that the firm raised the pool from 46 investors. –Alastair Goldfisher

Storm rounds up $180 mln for fifth fund

Menlo Park, Calif.-based Storm Ventures has wrapped up fundraising on its fifth fund, reaching its hard cap of $180 million in commitments.

LPs include the Los Angeles County Employees’ Retirement Association documents, which approved a commitment of up to $50 million to Storm Ventures V at its Feb. 11 meeting. Storm Ventures held an initial close on Fund V of $102 million in November, according to a GCM Grosvenor report included in LACERA meeting materials.

As previously reported by VCJ, co-founders Sanjay Subhedar and Alex Mendez will not lead any new investments through Storm Ventures Fund V, but will serve in advisory roles.

Firm partners include Tae Hea Nahm, Ryan Floyd and Jason Lemkin.

Flare Capital unveils $200 mln fund, appoints CFO

Flare Capital Partners has raised $200 million for its first healthcare tech-focused fund. The fund has already made investments in such companies as Iora Health, Predilytics and Valence Health. It also has invested in Rock Health‘s most recent seed fund.

In addition to the fund, the Boston-based firm has named Kristen Laguerre as partner and CFO. Previously, Laguerre was a partner and CFO at Atlas Venture and vice president of finance at SoftBank Capital. Also, Flare has appointed Dr. Dan Gebremedhin as a senior associate. –Iris Dorbian

RiverVest closes third fund

Life sciences venture firm RiverVest Venture Partners has raised $80.2 million for its third fund. RiverVest Venture Fund III LP will focus on pharmaceuticals and therapeutic medical devices with no geographic boundaries.

The St. Louis-based firm said that Fund II, at $75 million, held its initial close in 2006, has provided a net IRR of more than 20 percent per annum to the LPs.

Managing directors include Jay Schmelter, Tom Melzer, John McKearn and Niall O’Donnell. –Iris Dorbian

Seed Equity launches $10 mln fund

Seed Equity Capital Partners is seeking to raise $10 million for its initial venture seed fund. The Salt Lake City-based firm said the focus of the Seed Equity Venture Fund I is on early and growth-stage investments. –Iris Dorbian

From the filings: Collaborative, Harrison, True and more

The Collaborative Fund collected $65 million for its third fund, according to a regulatory filing. The New York-based firm, an investor in AngelLIst, Blue Bottle Coffee, Hampton Creek, Lyft and others, raised $33 million for its previous fund in 2014.

Harrison Metal Capital has raised $68 million for its fourth fund, according to a filing. The Palo Alto, Calif.-based firm has backed AltSchool and TinyPulse, among other early-stage tech companies.

True Ventures filed that it plans to raise a $175 million select fund. The fund – True Ventures Select 1 – would be the firm’s first select fund, No first close has taken place, the document states. True portfolio company Fitbit recently unveiled its plans to conduct an IPO.

San Francisco-based SherpaVentures is seeking to raise $175 million for its second fund, according to a filing. The firm, led by Shervin Pishevar and Scott Stanford, raised $154 million for its debut fund.

Rethink Education has set out to raise a $125 million second fund, according to a regulatory filing. The new fund, Rethink Education II, would be a big step up from the firm’s first fund in 2012. That fund raised $25 million, according to an SEC filing. The New York-based firm, led by Managing Partners Matt Greenfield and Rick Segal, invests in early-stage edtech startups.

Healthcare-focused Longwood Founders Management, an investor in Calithera Biosciences Inc, which went public last fall, is seeking $90 million, according to a regulatory filing. The firm raised $66.66 million for its previous fund, which closed in 2014, according to data from Thomson Reuters. Its inaugural fund raised $86.93 million in 2010.

San Mateo, Calif.-based Shoreline Venture Management, which focuses on seed-stage and early-stage healthcare and software deals, has already raised $3.9 million from 19 investors, according to a regulatory filing. Exits from its previous fund include Layer 7 Technologies, Callixa and Health Hero Network. The firm’s website already lists Seattle-based Blab, a provider of predictive social analytics, as a portfolio company in its third fund.

Asia

Lightspeed strengthens Indian arm

Menlo Park, Calif.-based Lightspeed Venture Partners is to pick up the pace of its Indian investments with its first ever dedicated fund in the country.

Lightspeed India Partners I is seeking $115 million.

In India, the firm invests from $1 million to $25 million across all stages in retail, advertising, media, business and financial services, healthcare and education.

Although Lightspeed has operated an Indian office since 2004, its New Delhi team must still draw from the firm’s main funds, the 10th of which closed on $950 million last year.

In contrast, Lightspeed closed its first dedicated China fund in 2013, and Shanghai-based Lightspeed China Partners raised $260 million for a second fund in 2014. –Alex Derber

Russia turns to China for tech collaboration

Russia’s Skolkovo Foundation and the Cybernaut Investment Group of China have teamed up to boost the development of robotics startups.

Under a preliminary deal signed in Beijing, Hangzhou-based Cybernaut will create a $200 million venture fund to invest in Skolkovo-resident startups that specialize in IT, robotics, telecoms and space technology.

The agreement, which comes into effect later this year, also foresees the creation of an R&D incubator at Skolkovo.

In return, the Skolkovo Robotics Center will advise on the creation of a robotics facility in China.

Vasily Belov, senior vice president for innovation at the nonprofit Skolkovo Foundation, said in a statement that the new deal formalizes ties in place since 2013, which have already seen several Skolkovo teams sell technology to Chinese businesses. –Alex Derber

Europe

SHS completes $140 mln medtech fund

Tuebingen, Germany-based SHS is moving towards growth capital and small buyout deals following an oversubscribed final close for its fourth fund.

While SHS’ previous, €50 million ($56 million) fund focused on late-stage venture in the medtech and diagnostics markets, fresh commitments totalling €125 million ($140 million) will allow the firm to write bigger tickets and pursue more spin-outs.

However, managing director Hubertus Leonhardt said that the firm will retain a balanced portfolio, so venture deals, typically between €2 million to €8 million ($2.3 million to $9.2 million) will continue.

Investors in Fund IV include SHS’ management, the European Investment Fund, as well as funds-of-funds, family offices, pension funds and insurers.

SHS focuses on German-speaking countries, although the firm will invest elsewhere in Europe and America, especially those taking advantage of Europe’s streamlined process for medical device approval. –Alex Derber

Pearson vouches for Fuel Ventures

Fuel Ventures, a new early-stage venture fund and incubator aimed at ecommerce startups, is taking shape in London.

The brainchild of Mark Pearson, the entrepreneur behind MyVoucherCodes, Fuel is marketing a £30 million ($47 million) open-ended fund to family offices and wealthy private investors.

The fund will invest from £100,000 for incubation-stage companies and up to £1 million ($1.6 million) in Series A deals.

“We particularly like innovative shopping models, innovative product companies and software and services for ecommerce businesses,” Pearson told VCJ.

Alongside straight venture investments, Pearson hopes to build a stable of ecommerce companies under the roof of Fuel Studio, his startup incubator. –Alex Derber

Australia

Brandon eclipses prior fundraising

Brandon Capital, a Melbourne-based life sciences investor, has more than quadrupled the size of its latest fund following support from four Australian pensions.

AustralianSuper, StatewideSuper, HESTA and HOSTPLUS Industry Super Funds signed up to the A$200 million ($160 million) Medical Research Commercialisation Fund (MRCF) III, which will target early-stage deals for healthcare and medtech companies.

Yet pension fund backing is a rarity in Australia, according to Brandon Managing Director Chris Nave, who told VCJ that “there has been very little new money committed to Australian VC funds in the past seven years.”

Investments will range from A$500,000 to A$4 million ($400,000 to $3 million) in seed and Series A deals, while the only change in strategy from Brandon’s 2011-vintage prior fund is greater follow-on investment. –Alex Derber

Chinese capital flows to tank stream

An unnamed Chinese venture firm has given fresh impetus to Sydney-based Tank Stream Ventures (TSV), which has finalized its first early-stage digital fund at A$20 million ($16 million).

TSV targets mobile, ecommerce and software, typically investing about A$500,000 ($400,000) as a bridge between seed and Series A funding.

Its portfolio already includes six companies following a cornerstone commitment from Bridgelane Group in 2013. Bridgelane CEO Markus Kahlbetzer is also a partner at TSV.

TSV Managing Partner Rui Rodrigues told the Australian Financial Review that the Chinese LP commitment would open a gateway into China for TSV’s most successful companies.

Other investors in the fund include wealthy individuals and family offices. –Alex Derber

Middle East

Bullish outlook for Lebanese VC

A fundraising blitz by Middle East Venture Partners (MEVP) has seen the Beirut firm win fresh capital just months after closing its $70 million IMPACT fund.

Middle East Venture Fund II is MEVP’s fourth fund, and is supported by banks, family offices, telecoms companies and wealthy individuals.

MEVF II will target online businesses, but in the wider Middle East and North Africa (MENA) region, rather than just Lebanon.

MEVF II will also offer smaller tickets of $500,000 to $3 million for Series A deals.

“We were quick in fundraising after IMPACT because we wanted to maintain our regional footprint and stay active throughout MENA,” MEVP associate Jad El Boustani told VCJ.

He added that the region had become “a breeding ground for startups” thanks to high smartphone penetration rates and rising ecommerce sales.

The firm has invested $16 million from IMPACT since its first close in late 2014.

Meanwhile, four investments have been made from the new MEVF II, which MEVP hopes to close at $30 million before the summer. –Alex Derber