Avolte Venture Partners reaches capital goal

Madison, Wis. - Avolte Venture Partners Midwest, a venture capital arm of Boston's Peak Ridge Capital Group, Inc., says it has reached its initial goal for raising capital and is ready to scout for early-stage investments in Wisconsin and the Midwest.

The fund, which was to be capped at $50 million, has not raised that much yet, but has raised enough for an initial close, according to Michael McNally, chairman and CEO of Peak Ridge. The fund, which was established in September of 2006, will focus on the life science and information technology industries.

McNally, who also is a general partner in Avolte Venture Partners, said the fund looks forward to beginning the investment process. He characterized the current investment climate as “highly conducive” and said the Avolte/Peak Ridge management is well-positioned to capitalize on it.

McNally declined to disclose exactly how much the fund has raised, saying it operates as a blind pool for dozens of limited partners and that it has found it more advantageous not to disclose that information.

“When we promote how much we have, it actually takes away investment opportunities from us,” he said. He reaffirmed that the fund intends to make 10 to 15 investments ranging from $1 million to $3 million per company.

Here to stay

McNally is sensitive to Peak Ridge's outsider status, making reference to Frazier Technology Ventures, a Seattle-based venture capital firm that received $50 million from the State of Wisconsin Investment Board in 2003 but has yet to make an investment in a Wisconsin company. He said Peak Ridge is committed to investing in Wisconsin, noting that it has had a great deal of success in bringing about “exit events” for companies, and that the Avolte fund will, when practical, syndicate with existing Midwest investment funds.

“We look forward to working with other local venture capital firms,” McNally said, adding that Peak Ridge's experience and international network would benefit Wisconsin.

In addition to Boston and Madison, Peak Ridge has offices in Toronto, Ontario.

McNally also said the company has opened an office in Madison's East Side TEC Corridor, and that it is staffed by Wisconsin native Jason Smith, who serves as general manager of the Avolte Midwest Fund and as Midwest director for Peak Ridge Capital Group.

Smith could not be reached for comment, but said in a release that Avolte would provide a “much-needed bridge” between Wisconsin and Boston's more mature venture market. “Given the existing infrastructure and opportunities,” he said, “we expect that providing more of a national forum for local portfolio companies will accelerate company growth and enhance exit opportunities.”

Hunting the investment

Since announcing the fund last year, McNally said Avolte has spent the majority of its time raising capital, but it is well aware of companies here that operate in life science and information technology. While there is nothing imminent, he said the process of scouting potential investments has begun.

As it considers Midwest investments, Avolte will continue to accept subscriptions from accredited investors. A number of factors make it difficult to predict a final closing date, but McNally said the company expects to close the fund shortly.

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