Fund Briefs, June 2010

K9 Ventures Closes Debut Fund

K9 Ventures, a microfund launched by entrepreneur-turned-investor Manu Kumar, has closed its debut vehicle.

The Palo Alto, Calif.-based seed stage fund raised $6.25 million to be invested over the next three to four years in slugs of $100,000 to $250,000 per company, with some capital reserved for follow-on rounds.

The money was raised from individual investors, including those who have backed Kumar’s startups, he said. Kumar calls K9 Ventures a “concept stage” and seed stage investor that will syndicate deals with angels, angel groups and VCs.

Kumar began raising the fund, and deploying what he’d raised, last summer.

So far, K9 has stakes in five companies, including CrowdFlower, which organizes labor on demand for its customers; Twilio, which develops technology to incorporate telephony functionality; DNAnexus, a software developer that helps manage data gathered from the DNA sequencing process; and HighlightCam, a provider of webcam video services.

Manu previously founded and was president and CEO of SneakerLabs, which developed software and services for Web-based customer interaction and was acquired by E.piphany in 2000. He later served as chairman and CEO of iMeet, a provider of Web-conferencing services that merged with Netspoke in 2002. —Constance LoizosHealthCare Ventures Raising Fund Nine

HealthCare Ventures, which has been making early stage and growth stage deals since 1985, is targeting upwards of $250 million for its ninth fund, according to a regulatory filing. The fund would be a step down from the nearly $380 million it raised for its eighth fund in 2005.

Managing Directors James Cavanaugh and Hal Werner, who were listed as principals in a fund VIII filing, are not listed in the latest fund filing. The pair are the firm’s only investment pros in Princeton, N.J., while the remainder are based in Cambridge, Mass.

Neither Cavanaugh nor Werner returned calls for comment.

HealthCare Ventures currently lists 41 active portfolio companies, including Oriel Therapeutics, which recently announced that it would be acquired by Sandoz. —Dan Primack

Artiman Ventures Begins Marketing Push

Artiman Ventures is seeking to raise at least $150 million for its latest early stage fund, Artiman Ventures 3. The firm, which has offices in East Palo Alto, Calif., and Bangalore, India, raised $185 million for its previous fund, which closed in 2007.

The firm is led by founder and Partner Amit Shah, who currently sits on the boards of AbsolutelyNew, Auryn, Dyyno, Guavus, InvenSense, Lightwire, Mastek, Motif and Zyme Solutions, according to Artiman’s website. Before founding Artiman, Shah was a general partner at seed stage venture firm Anthelion Capital.

Millennium Closes Second Secondaries Fund

Millennium Technology Ventures, a New York-based direct secondaries firm, has closed its second fund with $280 million in capital commitments. Millennium topped its $250 million hard cap by $30 million. The firm closed Millennium Technology Value Partners II LP with $280 million in commitments.

“To date, we have done about 300 secondary direct investments,” Managing Partner Sam Schwerin told VCJ. “Over 40% of deals are buying stakes from institutions [such as strategic backers and investment firms] and the rest is from individuals, typically founders and senior employees.” (For more from Schwerin, see Six Quick Questions on page 2 of this issue. —Ed.)

Opus Working on New Fund

Opus Capital, a Menlo Park, Calif.-based VC firm focused on early stage tech companies, is raising upwards of $175 million for its new fund, according to a regulatory filing.

The fund is officially listed as Opus Capital VI, but it is the firm’s second fund since Weiss Peck & Greer Venture Partners split into two firms: Opus Capital and Lightspeed Venture Partners.

Opus Capital’s first independent fund closed in 2006 with $280 million.

Early Stage Partners Raises $55M

Early Stage Partners, a Cleveland-based venture firm focused on life sciences and tech in the Midwest, has closed its second fund with nearly $55 million in capital commitments.

Early Stage Partners said in its email newsletter that it had raised about 60% of the fund when the economy began to falter before last year. The firm raised $44 million for its first fund, which closed in 2006.

Avalon Ventures Eyes $150M

Avalon Ventures is targeting $150 million for its ninth fund, as first reported last month by VentureWire.

The La Jolla, Calif.-based venture firm focuses on early stage biotech and wireless technology companies. The firm raised $150 million for its eighth fund, which close in 2008. Limited partners in past funds include Harvard Management Co., Paul Capital Partners, Grove Street Advisors and Invesco.

Companies in Avalon’s portfolio include Zynga Game Network, whose games are popular on Facebook.