Getting to Know the Utah Fund of Funds
Part III: A Portfolio with Purpose
By Jeremy Neilson and Kimball Thomson
<< Read the first article: Part I: A Local Habitation and a Name
<< Read the second article: Part II: Structured for Maximum Impact
<< Read the fourth article: Part IV: The Importance of the Utah Fund of Funds: Entrepreneurial Voices
This is the third in a series of short articles describing the vision and purpose, structure, direction and progress of the Utah Fund of Funds (Utah FoF; http://www.UtahFoF.com), one of Utah's most significant ongoing economic development programs.
The first installment of this series provided an overview of the UtahFoF, while the second described the program's structure and financing. The present installment will describe the program's current portfolio of venture/private equity funds. The entire series can be accessed on the UtahFoF website under "In the News" or through the following link: http://www.utahfof.com/ufoff_story.html.
The mission of the Utah Fund of Funds, created by the Utah Legislature through the passage in 2003 of House Bill 240 - the Venture Capital Enhancement Act - is to increase the amount, quality and diversity of capital funding available to help the state's early-stage and growth companies to grow, prosper and mature in Utah. To fulfill this mission, the Utah FoF evaluates quality venture firms within and outside Utah, with the assistance of the program's professional investment advisor, Fort Washington Capital Partners.
While the UtahFoF program has legislatively been advised not to invest its capital in first-time venture investors, it may consider investing in first-time firms whose partners have established a track record of sound investments and successful returns. In addition, the program has determined not to require its portfolio firms to open an office in the state, or contractually bind them to commit to invest specified dollar amounts in Utah companies. It does, however, require partners of its portfolio firms to commit to spending time in Utah meeting with companies and entrepreneurs, and/or to make themselves available for Utah executives to visit them at their offices. The primary rationale for these decisions is to maximize investment returns and access to primary decision makers at the firms. Research and experience indicates that requiring offices or investment clauses results in a lack of interest from the nation's best-networked, successful investors, and in time commitments being fulfilled by junior professionals at the firms, who do not have a vote on investment decisions. The Utah FoF is committed to obtaining successful investors and partner-level attention for Utah.
The Utah Fund of Funds Portfolio
As of March 2007, Utah FoF portfolio consists of nine investment firms, ranging from seed stage to later-stage growth companies, and across a variety of industry areas, from life sciences and information technology to retail, consumer and business services. The Utah FoF is developing a diversified portfolio regarding investment stage, industry specialty, geographic focus (in addition to Utah) and vintage year, resulting from 20 or more fund investments by early 2008. http://utahfundoffunds.com/portfolio.html
SV Life Sciences Fund IV, L.P.: A $550 million round. Founded in 1993 as Schroder Ventures Life Science, SV has offices in Boston, San Francisco and London. The firm focuses on multi-stage investments across the life sciences sector. Managing partners include David Milne, Michael Ross, Ph.D., Lutz Geibel, Jim Garvey and Eugene Hill. Leading co-investors include Abingworth Management, Aisling Capital, Alta Partners, Carlyle Group, MPM Capital, Oak Investment Partners, Orbimed, Oxford Bioscience Partners, Prospect Venture Partners, Three Arch Partners and Versant Ventures.
Cross Creek Capital, L.P. Fund I: $111 million. Based in Salt Lake City, Cross Creek is new Utah based fund and the venture capital investment arm of Wasatch Advisors. The firm focuses on late-stage investments across a broad spectrum of industries. Managing directors include Karey Barker, Greg Bohlen, Robert Gardiner and Samuel Stewart. Leading co-investors include Arch Venture Partners, Domain Associates, Meritech Capital Partners, New Enterprise Associates and Questmark Partners.
Rosewood Capital V, L.P.: $295 million. Rosewood Capital, based in San Francisco, was founded in 1985 and focuses on expansion-stage growth companies, primarily in the consumer, retail and business & financial services sectors. Managing directors include Chip Adams and Kevin Reilly; Carl Peterson serves as vice president. Top co-investors include Bain Capital, Benchmark Capital, Carlyle Group, Catterton Partners, Goldman Sachs, Kleiner Perkins, Sutter Hill Ventures, Technology Crossover Associates and Venrock Associates.
RWI Ventures II, L.P.: $65 million. Founded in 2000, RWI Ventures focus is on multi-stage investments in the technology and healthcare (medical devices) sectors. Managing directors include Donald Lucas, William Baumel and Mark Foley. Leading co-investors include Alloy Ventures, Canaan Partners, Delphi Ventures, DeNovo Ventures, Frazier Healthcare Ventures, Foundation Capital, Invesco, Kleiner Perkins, Meritech Capital Partners, Prism VentureWorks, Venrock Associates and Warburg Pincus.
University Venture Fund: $18 Million. Based in Salt Lake City, University Venture Fund is a new Utah fund, founded in 2005 to provide students exposure to the venture capital industry, perform due diligence and serve as a source of quality deal flow to co-investing firms. Its focus is early-stage co-investments with its network of funds across a broad spectrum of industries. Jared Hutchings and Mark Campbell are the managing directors. Major co-investors include Bain Capital, Canaan Partners, Draper Fisher Jurvetson, Intel Capital, Thomas Weisel Partners, UV Partners, vSpring Capital and Wasatch Venture Fund.
vSpring II, L.P.: $85 Million. Founded in 2000, vSpring focuses on seed and early stage investments in the technology and life science sectors, primarily in the Intermountain West. Managing directors include Dr. Dinesh Patel, Ed Ekstrom, Paul Ahlstrom and Scott Petty. Leading co-investors include Apax Partners, Domain Associates, Draper Fisher Jurvetson, Intel Capital, UV Partners, Venrock Associates and Wasatch Venture Fund.
5AM Ventures II, L.P.: $150 Million. With offices in San Francisco and Boston, 5AM focuses on seed and early-stage life science investments. Managing partners include John Diekman (founder), Scott Rocklage and Andrew Schwab (founder). Leading co-investors include Delphi Ventures, Frazier Healthcare, Polaris Ventures, Three Arch Partners, Venrock Associates and Versant Ventures.
Highway 12 Ventures II, L.P.: $75 Million. Founded in 2000 and based in Boise, Highway 12 is a Village Ventures network affiliate. Its focus is on seed, early, and expansion stage investments in the Intermountain West, across a broad spectrum of industries. Partners include Mark Solon, Phil Reed, Mike Mers and Matthew Warta. Leading co-investors include UV Partners, InQTel, Shasta Ventures and Battery Ventures.
Apax US VII, L.P.: $850 million. Based in New York City, Apax focuses on buyouts in the retail & consumer, tech & telecom, healthcare, media and financial & business services industries.
In the following year, the Utah Fund of Funds plans to expand its high quality portfolio by seven to 10 additional firms.
For more information about the Utah Fund of Funds, visit http://www.utahfof.com or call Jeremy Neilson at 801.521.3072.
Jeremy Neilson serves as managing director for the Utah Fund of Funds. Kimball Thomson is an Alpine-based freelance writer, and president and CEO of Next Phase Communications, an integrated public relations and marketing firm that represents the Utah Fund of Funds.
<< Read the first article: Part I: A Local Habitation and a Name
<< Read the second article: Part II: Structured for Maximum Impact
>> Read the fourth article: Part IV: The Importance of the Utah Fund of Funds: Entrepreneurial Voices
>> Read the fifth article: Part V: Progress and Future of the Utah Fund of Funds
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