SAN DIEGO/IRVINE, Calif. – Ventana Growth Funds, which offers a suite of domestic and international early-stage venture funds, at press time expected a mid-year final close on its most recent vehicle, Technology Gateway Partnership.
Ventana, founded in 1974 by Thomas Gephart, invests in early-stage information technology and the Internet, and in medical technology and biotechnology companies. In addition to the United States-focused Technology Gateway, the firm manages several Latin American and environment-focused funds such as Chile Private Equity and Technology Fund (Chiletech), Brasil Technology Gateway Fund (Brasiltec) and the Mexico City-based North America Environmental Fund.
Technology Gateway, which is expected to close on between $30 million and $35 million by July, held a $15 million first close in late 1998. Approximately 70 strategic limited partners from 20 countries in Europe, Latin America, Asia, the U.S. and Canada back the firm’s venture funds. Ventana signed its first international investors in 1982, when Mr. Gephart was joined by his current partner, Duwaine Townsen.
With Ventana’s early-stage strategy, Mr. Gephart sees the firm as a “facilitator for large capital.” The firm invests about $1 million to $3 million per deal and is often the first professional money in a start-up. When a portfolio company needs a second round of financing, Ventana will co-invest with larger firms.
“We want a lot of friendly, big investors to come in,” Mr. Gephart said. “There’s an enormous amount of capital available for new deals.”
Ventana’s portfolio companies historically have been located in Southern California. However, with Technology Gateway, the firm will “open up the framework a bit,” he said. About half the fund will back information technology, Internet and e-commerce companies, 30% is earmarked for medical technology companies and 20% is slated for the beleaguered biotech industry, which Mr. Gephart believes will make a comeback in the next year or so.
Technology Gateway’s managing director is Scott Burri.
With its first close, the vehicle has financed three deals, including Newport Beach, Calif.-based online ticket broker Tickets.com Inc., which in early 1999 merged with a smaller competitor, Advantix, and likely will file to go public sometime this year. Other investors in Tickets.com include General Atlantic Partners, Chase Capital Partners and Idealab Capital Partners.
Ventana’s first Latin American vehicle, 1992’s North America Environmental Fund, is dedicated to cross-border environmental and investment needs of companies conducting business in Mexico. With its experience in the market, the firm was appointed by the Multilateral Investment Fund, a division of the Inter American Development Bank, to manage Chiletech, which closed in 1998.
North America Environmental Fund and Chiletech were reorganized in 1998 under the Ventana Latin American Group, which in early 1999 was on the fund-raising trail again for Brasiltec, a $35 million-targeted fund that will focus on developing environmental, information technology and biotech deals in Brazil. The fund has about $15 million in soft-circled commitments from traditional Brazilian pensions and insurance companies, Mr. Gephart said.
Carlos de Rivas, Alvaro Edwards and Guiliterme Emrich manage North America Environmental Fund, Chiletech and Brasiltec, respectively.