WOODSIDE, Calif. – The Woodside Fund, an early-stage investor in Internet and telecommunications companies, is raising its fourth vehicle, the $125 million-targeted Woodside Fund IV.
The vehicle had more than exceeded its $100 million target, just three months after its launch in September 1999. As a result, the firm was forced to increase the fund’s size to accommodate the demands of its limited partners, who were attracted to Woodside’s investment strategy and its returns, said Daniel Ahn, a principal at the firm.
Many LPs had boosted their commitments to the fund by about three or four times, said Vincent Occhipinti, a founder and managing director at the firm. The fund is expected to hold a final close sometime during the first quarter of 2000.
Fund IV will back some 20 to 25 early-stage Internet, e- commerce, computer software, telecommunications and networking companies mainly on the West Coast, with individual investments ranging from $4 million to $8 million over several rounds of financing, Occhipinti said.
The firm’s previous $41 million Woodside Fund III, which closed in 1995, is completely invested in 21 companies, Occhipinti said, adding that Woodside typically acts as the lead investor and prefers to co-invest. Portfolio companies include Brightware Inc., an e-customer and e-mail assistance software provider, and HotRail Inc., a provider of switched fabric solutions for symmetrical multiprocessing.
Woodside’s limited partners include pension funds, endowments and strategic individuals, such as entrepreneurs and industry executives who can add value to portfolio companies. The firm operates under a management fee and carried interest structure Occhipinti described as standard.
The firm’s investment professionals are Occhipinti, Robert Larson and Charles Greb, the firm’s three managing directors, Ahn and Analyst Matthew Bolton.
Ahn, who has been with the firm since January 1999 as an associate consultant, recently was named principal, and he focuses on business-to-business e-commerce and infrastructure companies. Prior to joining the firm, Ahn was an associate at Forester Management Co., and before that, he was co-founder and president of technology start-up Endpoint Technologies Inc.
Founded in 1983, Woodside refers to itself as a builder of companies because the members of its investment team all have prior experience as entrepreneurs. They often tell entrepreneurs seeking capital that “there hasn’t been a mistake we haven’t seen or caused,” Occhipinti said.