When David Gardner started raising money for his new Cofounders Capital fund earlier this year, investor friends told him it’d take more than two years and he’d be lucky to raise $5 million.
It didn’t take long to prove them wrong.
After 90 days of fundraising and a period of due diligence, the Cary angel investor and serial entrepreneur has closed on $10 million of a $12 million fund. By the end of the month, he’ll have the rest of the funds from 80 or so local investors, many of whom have co-invested with Gardner or funded one of his previous businesses. He’s already got term sheets out to two companies, and follow-on investments planned for Testive, FilterEasy and Pack Purchase, companies in his personal portfolio that he rolled into the new fund.
Gardner appears to be bucking a national trend—the National Venture Capital Association reported in April that though total dollar commitments to U.S. venture funds grew 21 percent in the first quarter of 2015 over the quarter prior, fewer funds raised money and they closed significantly less than in the first quarter of 2014.
The goal of Gardner’s Cofounders Capital, unique from most funds, is to invest all local. He wants to overcome a shortage of capital here, to get fast-growing companies in the Triangle to profitability or later stage rounds more quickly, and to preserve local investors’ shares as those companies hit increasingly higher valuations. He sweetened the deal for investors by rolling in his existing portfolio of 17 companies, only one of which is in the process of shutting down, and by letting investors add funds to any company’s round without a fee. That’s not customary in the venture world.
For more details, read the full report at ExitEvent:
http://exitevent.com/article/david-gardner-lands-10m-cofounders-capital-fund-150616
