Editor’s note: Monday through Friday, Local Tech Wire profiles a venture capital or investment firm. Matthew Burns and Daniel Pearson compiled the series. Monday, Local Tech Wire will begin profiling venture and investment firms in Atlanta. After forming in early 2001, Southern Capitol Ventures quickly got a taste of the lousy market for technology investing. Just like the young companies it planned to back, the Raleigh-based firm found it difficult to raise money and had to scale back plans for a $20 million initial fund, settling on a figure half the size.

Southern Capitol already has formed alliances with The Atlantis Group and truePilot, two angel investor networks in the Triangle, and independent financial services firm Capital Investment Companies to make its seed and early stage investments more effective.

The firm also receives financial and technical support from the N.C. Biotechnology Center.

Through an investment in Atlantis, Southern Capitol has provided funding for firms such as Batanga, LiveWire Logic and Overture Networks. It also has made direct investments in FullSeven Technologies and ChannelAdvisor. The firm tries to limit the size of its portfolio so that its partners can spend more time working with individual companies.

Here’s the skinny:

Featured firm: Southern Capitol Ventures

Mailing address:
21 Glenwood Avenue, Suite 107, Raleigh NC 27603

Phone number: (919) 858-7580

Web site: www.southerncapitolventures.com

Management Team:

Ben Brooks, Managing Director
Jason Caplain
Dave Murray

Focus of firm: Seed and early stage technology and life science companies in the Southeast.

Size of current fund: $5 million to $10 million

Money under management: Do Not Disclose

How many of those dollars have been invested: 75 percent of funds raised.

Companies funded in 2001:Direct investment in FullSeven Technologies and indirect investments in Batanga, LiveWire Logic, BlueBolt Networks, Zoom Culture, Overture Networks, OpenMind Publishing through our investment in The Atlantis Group.
How many new deals do you expect to fund in 2002: 4-6

In what size range: Seed and early stage

Sweet Spot (types of deals, stage of the company): Seed and early stage, technology companies with pre-money valuations of $3M to $5M.

Most important attributes for companies seeking funding: Superior management teams, proprietary technology or unique market position, large and growing market opportunities, compelling business strategy, and an opportunity for substantial financial return.

What differentiates you: To make sure each of our portfolio companies gets the support they deserve, we limit the number of companies we invest in. This strategy gives us unusually high partner-to-company ratio and ensures portfolio companies get the attention they need to succeed. We also receive technical and financial support from the North Carolina Biotechnology Center.

Monday’s profile: Alliance Technology Ventures of Atlanta

Previous profiles can be found by searching Venture Watch category. The series thus far:

Feb. 11: Academy Venture Funds
Feb. 12: Atlantic Group
Feb. 13: Aurora Fund
Feb. 14: Capital Investment Partners
Feb. 15: Carolina Financial Group
Feb. 18: Carousel Capital
Feb. 19: Catalysta Partners
Feb. 20: Charlotte Angel
Feb. 21: Draper Atlantic
Feb. 22: Eno River
Feb. 25: Halifax Group
Feb. 26: Intersouth Partners
Feb. 27: Kitty Hawk Capital
Feb. 28: NC Enterprise Corp.

March 1: NC Technological Development Authority
March 4: Oberlin Capital
March 5: A.M. Pappas
March 6: Piedmont
March 7: RBC Centura
March 8: Redleaf Group
March 11: Remington Capital
March 12: River Cities
March 13: Research Triangle Ventures
March 14: Southeast Interactive
March 15: Tri-State Investment Group
March 18: Trelys
March 19: truePilot
March 20: Wakefield Group
March 21: Frontier Capital