Renaissance Venture Capital Fund raises $50M

Thursday, September 9, 2010 | Source: metromode

The venture capital fund of all funds in Michigan is now fully operational, and it has ties all over Metro Detroit.

The Renaissance Venture Capital Fund closed a $50 million investment vehicle earlier this week from a number of local business institutions. The downtown Ann Arbor-based firm, which also has an office in downtown Detroit, plans to invest that money in both local venture capital firms and out-of-state venture capital firms with the intent to invest in local companies.

"It's probably going to invest exclusively in other venture capital funds," says Chris Rizik, CEO of the Renaissance Venture Capital Fund and a Northville resident. "We feel we will have more leverage that way."

The fund of funds has already invested almost $6 million (for a total commitment of $20 million) in half-a-dozen venture capital firms. Those firms in turn have invested more than $23 million into 12 Michigan companies, creating about 200 new jobs. Those companies have leveraged that investment to receive over $146 million in further venture funding. Renaissance Venture Capital Fund expects its money will touch 100-150 companies, creating hundreds of new jobs rooted in the new economy. It has already disbursed its first profits to investors.

The fortunate six venture capital firms include Ann Arbor's Arboretum Ventures and RPM Ventures, along with Kalamazoo-based T-Gap Ventures. Out-of-state firms receiving an allocation include San Francisco-based 5AM Ventures, Houston's DFJ Mercury Ventures, Illinois-based MK Capital, and Florida's Arsenal Ventures. The last two are opening Michigan offices following Renaissance Venture Capital Fund's investment.

The Renaissance Venture Capital Fund was put together by the Business Leaders For Michigan and is funded by the likes of DTE Energy, AAA, Blue Cross Blue Shield of Michigan, and Huntington Bank. Most other funds of funds are supported with public money. Michigan's private model makes it an industry leader and example of how Michigan is breaking new economic ground when it comes to reinventing its economy.

"That isn't happening anywhere else in the country," Rizik says.

He expects his 3-person firm, which is looking at adding interns next summer, to finish disbursing the money over the next year or two. Fundraising for the next investment vehicle, which might also make investments directly into companies, will begin in 2012.

Source: Chris Rizik, CEO of Renaissance Venture Capital Fund
Writer: Jon Zemke