Durham venture capital fund SJF Ventures has raised $125 million from investors for its fourth fund, nearly 40 percent more than it raised for its third fund and blowing past its $100 million target.
In fact, $125 million was the fundraising cap that privately held SJF set in the prospectus it distributed to potential investors.
“We made some investors angry because we turned people away,” said Dave Kirkpatrick, managing director and co-founder of the firm that started investing from its first fund – which totaled $17 million – in 1999. “It’s a nice position to be in, although I don’t like making people unhappy.”
Kirkpatrick said the firm’s “really good” track record on investments helped the firm raise the money, but he declined to be more specific about the returns it has generated for its investors. SJF focuses on investing in cleantech business and other companies with the potential to benefit society, which is known as “impact investing.”
Kirkpatrick said the firm’s fund-raising effort also benefited from the growing realization among investors that “you can have great returns and great impact. There doesn’t have to be a sacrifice.”
SJF attracted money from more than 100 investors, including more than two dozen foundations, pension plans and wealthy individuals. Among its investors are the Doris Duke Charitable Foundation, Mary Reynolds Babcock Foundation and the Unitarian Universalist Common Endowment Fund.
With its latest fund, SJF has raised a total of $260 million. It has invested in 52 companies from its first three funds, including Triangle companies TransLoc, Aseptia and Validic.
SJF’s portfolio companies employ more than 10,000 workers, with 78 percent of those jobs created after SJF invested.
SJF typically invests between $3 million and $10 million in growth-stage companies. Venture capital firms provide companies with an infusion of cash in exchange for an ownership stake in the business, which they cash out on when theh company is sold or goes public – if all goes according to plan, that is. A venture capital firm can lose its entire investment in a company that fails.
“We’re eager to find other great companies that are doing great things and need capital to grow,” Kirkpatrick said.