By Allan Maurer
TAMPA, FL—Three veterans of the Florida venture capital industry are raising a new $100 million fund called Sunrock Ventures to target technology companies in the Southeast. Managing director Tate Garret says that because the Southeast has 20 percent of the nation’s population but only 5 percent of total venture capital invested nationally, it represents a potentially lucrative opportunity.
“We believe this region is going to deliver the best returns to investors over the next decade,” Garret says.
Garret points out that venture investing in the Southeast is less expensive because of the high demand for a limited supply of capital. “You can invest a lower price in the region and exit at the same price, because when a company goes public or is acquired, the difference disappears. It’s almost an arbitrage situation,” Garrett tells TechJournal South.
“It’s obvious the demand is there, Garrett says. “We put our Web site up on Friday and an entrepreneur called at 10 a.m.”
Garrett and co-managing directors Matthew Shaw and Jeffrey Wolf, all in their early 40s, have a cumulative 32 years of investment experience. They have experience in IT, business services and life science/healthcare investing, the areas on which their new fund will focus.
“In addition to our extensive involvement in building the Southeast’s venture capital community, each of us has successfully started, sold and restructured companies, and have taken companies public,” says Wolf. Equally impressive are the managing partners’ educational backgrounds, including MBAs from the Harvard, Wharton, and Stanford business schools, a law degree from the New York University School of Law, and undergraduate degrees from the University of Chicago, the University of Miami and Yale University.
“Combined, we invested $140 million in 41 companies,” Garret says. “Over the last ten years, the lack of capital in the region has driven us all crazy,” Garret says. Now is a good time to raise a fund, he adds, “because real estate has cooled off a little. For a while, people were making so much money in real estate that was all anyone wanted to talk about.”
“We hope we’re the beginning of a wave,” he says. “Just in the Tampa area alone I know of three other groups raising money this fall. We happened to get there first and I think we’re most likely to be successful quickly, but I hope all of us will be successful. The more capital we can bring to bear, the better.”
Sunrock Ventures, with offices in Tampa and Miami, intends to build a portfolio of 18-24 companies over the next four years, geographically focused on nine Southeastern states, Florida, Georgia, North and South Carolina, Tennessee, Alabama, Kentucky, Louisiana, and Mississippi. “We’re not looking at Virginia or Texas. They’re not as underserved as the rest of the region,” Garrett says.
Garrett, born and raised in Tampa, says he’s seen a lot of changes in the city. For business, he takes clients to Mise en Place or Oyster Catchers, but says deals don’t get sketched out on napkins as in the Internet boom years. “We tend to be more office-based,” he says.
On the Web: www.sunrockventures.com
Southeast Venture Conference, February 29 – March 1, 2012 at the Ritz Carlton in Tysons Corner, VA – Where Smart Money Meets Smart People.
www.seventure.org
© 2007, TechJournal South. All rights reserved.
