PROVIDENCE, R.I. – Riparian Partners, an investment banking firm launched fund raising in August for a $10 million to $15 million-targeted fund, said Brendan VanDeventer, one of Riparian’s partners and a general partner in the fund. The vehicle, whose formation was announced in September, will be part of the Village Ventures Inc. network of locally focused, early-stage venture funds (VCJ, August, page 5). VanDeventer, who declined to provide the fund’s formal name, anticipated a first and final close for the vehicle by the end of the year.
The fund will back technology-related companies in high growth industries, VanDeventer said. “This means telecommunications companies, Internet plays, some medical technology companies and marine-related technologies,” he commented. The vehicle will invest in early-stage companies looking for their first institutional round of funding, he said.
The fund will back between 10 and 15 companies with investments ranging from $500,000 to $1.5 million, VanDeventer said. Village Ventures will co-invest with the fund providing up to an additional $5 million of capital, he added. The vehicle will invest exclusively in companies from Rhode Island and Southeastern Massachusetts. “Basically, we expect all our portfolio companies to be within forty-five minutes of Providence,” he added.
The new fund is a result of Village Ventures approaching Riparian and asking for help in identifying who might want to team with Village Ventures for a Providence-based venture fund, VanDeventer said. “We thought it was the right thing for us to do,” he added, explaining “we talked with several Brown University professors who felt the state was losing promising deals out of state because there was no venture fund in state.”
VanDeventer said the fund is targeting corporations, banks, universities and colleges located in Rhode Island as possible limited partners in the fund. He did not identify any of the fund’s potential LPs. Matt Harris, chief executive officer of Village Ventures has been helping with the fund-raising process, VanDeventer added, noting the fund’s local flavor had been an aid in locating capital. “We live here and have a lot of contacts, so we have been fairly successful getting in the door and telling our story, which has been pretty well received,” he said. The vehicle has already received substantial commitments from some high-net-worth individuals, he said, declining to say how much capital had been raised to date.
The fund will be managed by VanDeventer and two additional Riparian partners, Bernard Buonanno, Jr., Stephen Griffin, as well as Village Venture’s Gina Raimondo, vice president of fund development, and Sean Marsh, vice president of capital investments. The general partners of the fund, Village Ventures and the three Riparian partners, will put up 1% of the fund’s total capital. VanDeventer described the vehicle’s management fee and carried interest structure as being at industry standard levels.
Village Ventures, which was founded in January by Harris and Bo Peabody, is a holding company managing a group of early-stage venture capital funds. The company received $80 million in venture funding in May and currently has 10 funds in its network.