Badger Fund of Funds investment strategy is to create funds of $25 million or less in committed capital which will invest in seed stage Wisconsin based companies. Investments will focus on a “Money for Minnows” investing strategy thereby more effectively supporting the entrepreneurial ecosystem that currently exists in the State.
Wisconsin has excellent deal flow in the seed investment segment especially for initial investments of $100,000 to $400,000 but has few established venture capital funds with an investment focus on these opportunities. Quality deal flow can partially be attributable to the Wisconsin University system which is the recipient of hundreds of millions of dollars in research grants each year. Additionally, ACT255 which provides a 25% state tax credit to individuals investing in new Wisconsin companies has also been a strong deal flow driver resulting in the creation of a robust angel network and increased angel funding over the last several years. Finally, the Wisconsin Economic Development Corporation has also played a role in helping to establish start-up companies by providing grants to new ventures and entrepreneurs.
Kegonsa Seed Fund (“KSF”) managed by Kegonsa Capital Partners has employed the "Money for Minnows" investment strategy very successfully for a number of years in Wisconsin. (see: Kegonsa Partners - Money-for-Minnows). In contrast to making fewer, larger investments like many current Wisconsin based venture funds, KSF has made more but smaller first-time seed investments, typically $400,000 in various Wisconsin companies. The companies have been geographically diverse (Wausau, Watertown, Green Bay, Fitchburg, Madison) and returns to KSF Limited Partners have exceeded 20% per year. "For more information about the Kegonsa Seed Fund see about kegonsa capital partners managed venture capital funds".
Sun Mountain Capital (“SMC”) also has extensive experience in nurturing entrepreneurial activity at the seed stage. The Firm currently manages and advises clients on investments in venture funds in the State of New Mexico and the country of Mexico. For more about these state mandated programs see About Sun Mountain Capital Managed Fund of Funds".
The “Money for Minnows” strategy will enable small, Wisconsin based start-up companies to grow and prosper to the point where they can attract out-of-state investment dollars from larger venture capital firms located throughout the U.S. thereby increasing the economic vibrancy of the state.
Venture Investment Segments
- Seed Investment
- Pre revenue
- Early Stage Investment
- Has revenue
- Growth Investment
- Cash flow BE
- Late Stage Investment
- Balance Venture Capital Funds
- Makes Seed/Early/Growth/Late stage investments in single technology focused company.