REDWOOD SHORES, Calif. – Gabriel Venture Partners expected to hold a close in October on its sophomore effort, the $300 million-targeted Gabriel Venture Partners II LP, which launched in August, said Phil Samper, co-founder and managing general partner at the firm.
The firm hopes the October close will be the first and final; however at press time, Samper suspected that a second close might be necessary.
With the new fund, Gabriel Venture Partners will back between 30 and 35 companies, with average investments around $7 million to $9 million, over several rounds, Samper said. The firm is willing to invest as little as $500,000 and as much as $15 million in any one company, he said.
The firm backs communications and networking companies, which Samper described as the “plumbing part of the Internet,” as well as information technology companies. The firm prefers to invest in early-stage deals so it has the opportunity to be a significant owner in each company, Samper said.
The firm’s previous vehicle, the $100 million Gabriel Venture Partners I LP, which closed in November 1999, is committed to 13 companies, with room for follow-on investments, Samper said, adding that the firm may make one new investment out of that vehicle. PlaceWare Inc., a Mountain View, Calif.-based communications company in the firm’s portfolio, filed to go public in March.
The firm has a rule that no one partner work on more than six deals at one time because the partners prefer to work closely with their portfolio companies, usually leading deals and taking board seats. The partners feel that concentrating on more than six companies at once would prevent them from dedicating themselves to the extent that they do currently, Samper said.
The firm’s limited partner base consists of banks, institutions and pension funds, as well as high-net-worth individuals from the technology industry, venture capital community and founders of the IndUS Entrepreneurial Group. Most of the firm’s previous investors have joined the new fund, many increasing their commitments to the firm. The firm is also talking with investors in Europe and Asia. The firm retains a 20% carried interest structure net of fees and a 2.5% management fee, Samper said.
The Gabriel Venture Partners investment team consists of Managing General Partners and co-founders Rick Bolander and Samper, General Partners Charles Heller, Scott Chou and Mahesh Kanumury and Associate Michael Wolf. The firm will likely add another one or two investors to the team, Samper said.
Gabriel Venture Partners opened its first office in Silicon Valley at the beginning of 1999, and early this summer added another in Northern Virginia. The firm chose to focus on the Mid-Atlantic region because the area is rich in talent, institutions and attractive valuations, Samper said. The firm expects to open another office in the Midwest around the time it wraps its new fund, he said.