For more than a year, David Jones and Jason Caplain fought to put together a new million venture capital fund as they slowly reached beyond Southern Capitol Ventures in which they remain involved and support existing investments.

Their perseverance paid off with a fund that ended up being oversubscribed for a total of $26 million. A prestigious list of investors participated, too, as WRAL TechWire reported.

Jones recounts the obstacles the duo faced and also talks about the focus of Bull City Venture Partners going forward in the second part of a Q&A with WRAL TechWire.

  • While you have said the fundraising environment is difficult in your new fund announcement on Monday, venture capital funding was up substantially outside of North Carolina last year to “dot com” boom era levels while early stage funding has shown improvement. Why is it difficult to raise startup funding and VC funding in general in the southeast?

We heard three main push-backs in fundraising:

1. “We don’t like venture capital”

2. “Why would we invest in the Southeast and Mid-Atlantic US when all the returns seem to be generated from NY/west coast?”

3. “Your fund is too small….”

Jason and I tried to educate and convince many potential LPs [limited partners] on points #1 and #3, but spent a majority of time educating potential LP’s on the Mid-Atlantic and southeast U.S. and the plethora of opportunities.

“The technical talent here is amazing with academic institutions: Duke, UNC, NC State, Georgia Tech, Univ of Maryland, UVa, et all and the presence of large tech companies: Cisco, Red Hat, IBM, SAS, Gannett, AOL, The Home Depot, UPS, Lenovo, Lowe’s and so many more.

“If you dig into the statistics, there is a strong track record of great companies being built and exited over time and the market is extremely underserved for venture capital.”

  • Will Bull City focus on N.C. firms or southeast firms as was the case with Southern Capitol?

Bull City Venture Partners will continue to focus on the Mid-Atlantic and Southeast US.

  • Will emphasis remain on early stage?

Yes. Most of our investments out of the new fund will be early-stage, but we remain opportunistic for capital efficient growth rounds where we can be impactful.