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Milwaukee Company Raises $90 million VC Fund for Midwest Projects

Stock Option Trading By Mike Klein • 08/12/03 Now Largest Venture Capital Firm Based in Wisconsin

MILWAUKEE, WI- Baird Venture Partners (BVP) has raised and closed an additional round of fund raising that increases the value their fund to $90 million to support applied technology, life sciences, healthcare and business service with a preference for companies located in Wisconsin and the Midwest. Milwaukees Baird Venture Partners was picked this year by the State of Wisconsin Investment Board (SWIB) to expand the venture capital pool in the state. Baird is now the largest VC in Wisconsin.

Baird and BVP have demonstrated a long-standing commitment to supporting Wisconsins growth companies, said Monica A. Jaehnig, portfolio manager for SWIB. There is a lot of untapped potential here and BVP is dedicated to helping develop that potential.

Baird Venture Partners received a $30 million commitment from SWIB, the 10th largest public pension fund in the United States, as part of its initiative to identify investment opportunities in early-stage technology companies in the state. BVD has raised an additional $60 million from investors that include the Wisconsin Alumni Research Foundation, Northwestern Mutual Life Insurance, Lurie Investments, the Helen Bader Trusts, Johnson Financial Group, Robert W. Baird & Co and select high net-worth individuals.

With the additional funds that we have raised, BVP has enhanced its ability to invest in and support high-growth companies, said Paul J. Carbone, co-director of Baird Private Equity and BVP managing partner. Carbone also noted that BVP has added several investment professionals to its staff to support the increased level of venture activity.

We continue to be optimistic about the investment prospects in Wisconsin, said Carbone. We see that the building blocks are in place for a growing technology industry. With the both financial and business resources that Baird has we are we are enthusiastic about the state of the VC market and our ability to grow companies,

Providing money is only part of the story. Our expertise in finance, marketing, sales and distribution, and strategic planning are part of the entire gamut of services we offer our portfolio companies. Now is a good time to building up a portfolio of VC investments, added Carbone.

To date, BVP has made investments in two Wisconsin companies: NimbleGen Systems, a life sciences company that provides high-density, custom DNA microarrays and related services and TomoTherapy, which provides an advanced and cost-effective radiation treatment device, known as helical tomotheraphy systems, for cancer patients. Both companies are headquartered in Madison.

SWIB also approved an additional $60 million for the Frazier Technology Ventures fund from a Seattle firm. Frazier is in the process of opening a fully-staffed Madison office.

SWIB chose both the Baird and Frazier funds this year to fuel and expand the venture capital funds pool in the state.

According to the Associated Press, Roger Ganser, president of the Wisconsin Venture and Growth Capital Association, said Bairds fund would likely attract attention from investors elsewhere in the nation.

It will start putting Wisconsin on the map, said Ganser, who also is a managing partner of Madisons Venture Investors.

John Byrnes, executive managing partner of investment firm Mason Wells, said,It will be good to see Baird in the market actively investing in deals. Baird brings a great network of business contacts and a perspective on the public equity markets that will be very helpful to the members of developing venture capital scene in Wisconsin and the greater Midwest.

Wisconsin has struggled to encourage more venture investing, which has been down nationwide.

Adam Bock, research manager for Early Stage Research said, Wisconsin has significantly less in-state venture capital than neighbors like Minnesota, Illinois, and Michigan. SWIB's commitment to encouraging the formation of new funds, especially to support venture investments in Wisconsin companies, is a fantastic boost to the development of a vibrant venture financing community in the state. It's good for start-up companies, it's good for the angels, and in the long run, it's critical for a diverse and healthy state economy.

The announcement by Baird reflects the continued confidence of a homegrown firm in Wisconsin, said Tom Still, president of the Wisconsin Technology Council. It also illustrates that Wisconsin is fertile ground for investors in search of technology that can be profitably transferred to the marketplace.

The Wisconsin Technology Council has long argued that our state -- and our region has the research base necessary to spin out great ideas. Now, thanks to the Baird fund, its co-investors, the efforts of other venture capitalists and the investment of the State of Wisconsin Investment Board, those great ideas stand a better chance of being paired with money. There probably has never been a time in the history of Wisconsin when more venture capital dollars were available to invest in Wisconsin companies, said Still.

Obviously, the main reason to float your company is to raise cash. The money raised can be used for buying other companies, paying off debt, funding huge advertising campaigns etc . When companies raise money by issuing shares they can still keep control. A company worth £100 million may raise £50 million by making, for example 50 million shares available at £1.00 each. Therefore the company still owns 50% and there are many shareholders helping to fund the growth of the company. Private Limited Company shares are normally restricted to its members, to staff and their families etc. They may only be sold or transferred with the permission of the Directors.

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