CHICAGO – Tribune Ventures, the venture capital arm of Tribune Co., plans to make as many as four earlier-stage investments in the next year to take advantage of increased early-stage investment opportunities in the Midwest, said Manager Shawn Luetchens.
The firm traditionally has focused on later-stage deals with commitments of between $3 million and $7 million, but now Tribune will devote up to $3 million to early-stage companies unable to raise capital because larger sized funds must focus on bigger deals.
“We are experiencing a larger range of first round investing because of the amount of capital out there,” Luetchens said. “It’s tough for people to spend time on early-stage, proof-of-concept rounds.”
While Tribune Ventures has no regional preference for the six-to-eight later-stage investments it makes annually, the firm has several reasons for targeting companies in close proximity to its Chicago headquarters for its smaller deals.
“It’s the difference between visiting companies once a week and visiting them once a month,” Luetchens said. “In addition, Chicago has a rich history, and we see a lot of energy and emphasis going behind growing its software and IT industries.”
The Tribune Co. is incubating two IT start-ups designed to complement the company’s core publishing and media assets, which includes BlackVoices.com. While the parent company will devote its resources to supporting venture investments, the companies themselves will operate independently.
“We have a lot of marketing power to offer people, and a record for dotcom advertising,” Luetchens said. “But we are not housing them.”
Recent Tribune Ventures investments include teach.com, a distance learning service, and Internet coupon distributor, Valupage.
The firm is close to hiring an investment professional to manage these earlier-stage deals.