Editor’s note: Venture Watch is a regular feature on Tuesdays.
Note: Link to Golden Pine web site has been corrected.Figures from the most recent PricewaterhouseCoopers Money Tree survey show a major reason why Golden Pine Ventures has a promising market segment to play in with its focus on early-stage and startup firms.
In 2000, more than 3,564 startups received venture funding. By 2003, the number plummeted to 951. The need far exceeds the funds.
An entrepreneur at heart, Christopher Meldrum now gets his chance to help emerging companies as managing partner of the newest venture capital firm in the Triangle.
Meldrum, a former executive at Paradigm, is already reviewing business plans at Golden Pine’s Durham office. He and his father, Peter, founded the firm, which announced its creation earlier this month. Three other executives, including former Paradigm genetics executive John Hamer, sit on the board.
The firm will focus on earlier stage financing, which is where Meldrum wants to be.
“I’ve always been interested in emerging technology and have had a very entrepreneurial focus,” Meldrum tells Local Tech Wire. “I like to work with early stage firms, and this is an area of needed. This is something I’ve wanted to do for a while, and the time was right.”
The addition of an early-stage venture fund is good news, says Brent Keating, group executive for Knowledge Based Industries at RBC Centura Bank.
“There is always a need for early stage and start up capital,” Keating tells LTW, “and certainly over the past two years this has been the toughest to raise. “
Golden Pine closed on its first money in June. Meldrum won’t disclose the amount, other than to say “It’s sufficient to form three to six portfolio companies and provide the funding those companies need until they reach later rounds, such as Series A.”
The focus of Golden Pine will be on biotechnology and biomedical firms. “The RTP area of North Carolina is a great place for new technology that is being developed at small companies and large companies plus tech transfer from academia,” Meldrum explains. “We felt this was an excellent region and one that was relatively underserved by the type of venture capital we are looking at.”
Golden Pine wants to find and partner with scientific founders of companies, a sector many VCs avoid. “It’s the toughest time for a company to survive,” Meldrum says. “The technologies aren’t really ready for prime time, or they are not particularly ready to come out of a university.
“Do they have potential if they can cross the gap funding stage and be successful — that’s what we’re focused on.”
By focusing on the earliest stage of emerging companies, Golden Pine will be a compliment to other funds, such as Aurora, Intersouth and A.M. Pappas. “They are firms we might be looking for to provide funding at later stages,” Meldrum says.
The biotechnology focus is not a surprise, given the backgrounds of the people involved.
Meldrum was director of corporate alliances at Paradigm Genetics, where he worked with Hamer. Meldrum has been involved in five startup ventures, helping each secure investment. He also served for five years on the board of directors at Alaxis Biosciences.
The elder Meldrum is president and CEO of Myriad Genetics. Peter Meldrum, who chairs the Golden Pine board, also served as president and CEO of Founder’s Fund, a venture capital group with a biotech focus. He helped launch nine companies, three of which went public. (Peter also was named one of Scientific American’s Top 50 Scientific Visionaries for work in biotech.)
Hamer, who currently is the entrepreneur in residence at Burrill & Company, helped launch Paradigm and held several positions. He also is acting CEO of Arete Therapeutics.
Also on the board are Jim Severson, vice provost for intellectual property and technology transfer at the University of Washington, and Dale Stringfellow, chairman of the board at Collateral Therapeutics and Myriad Genetics.
“We’re really excited about this board,” Meldrum says. “I know all of these guys and they are excellent individuals as well as having great pedigrees. They have done great things with their lives.”
Golden Pine has already reviewed some business plans, and Meldrum expects to see many more once word is out that an early funding source is available. The company will offer consulting and advisory services as well.
Golden Pine: www.goldenpineventures.com