Atlanta Life Venture Fund folds
Atlanta Business Chronicle - by Urvaksh Karkaria Staff Writer
Atlanta Life Venture Fund, an early-to-growth stage private equity fund that planned to raise up to $40 million, has folded, after a tanking economy derailed fundraising.
The fund, aimed at minority vendors to Fortune 1000 companies, had raised $5 million from Southern Co. (NYSE: SO), but could not find additional capital.
“We had a verbal commitment for a good bit of the money from a fund of funds,” said Ben Dyer, managing general partner at Atlanta Life Venture Fund. “But, then the economy jumped off the rails. People that were making commitments to us were having trouble themselves getting their limited partners to pony up.”
Atlanta Life Venture Fund is only the latest casualty in an imploding financial market.
U.S.-based venture firms invested in 250 companies last month, down from 565 firms in September and 518 in October 2007, according to preliminary data gathered by Thomson Reuters. The number of U.S. venture firms raising new funds in the third quarter tumbled about 29 percent compared with the same period a year ago, according to the National Venture Capital Association and Thomson Reuters.
Atlanta Life Venture Fund, according to its Web site, sought long-term capital appreciation primarily through co-investments with other institutional investors in a portfolio of minority-owned businesses. The fund focused primarily on investments in the Southeast, with an emphasis on metro Atlanta.
Atlanta Life Venture Fund had a limited pool of investors it could raise money from, Dyer said.
“We didn’t go out and beat the bushes,” Dyer said. “We didn’t talk to individuals. We only talked to large corporations that had diversity initiatives and to funds of funds that had special mandates for minority programs.”
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