Innovative Venture Capital Fund Launch To Cultivate High-Tech Talent in OregonSeptember 29, 1999 (Portland, OR) - Debi Coleman and Hugh Mackworth announced today a new seed-stage venture capital fund integrated with a business incubator, designed to help create the next generation of the Pacific Northwest's fast-growth, high-tech companies. The high-profile local executives intend to use private investments coupled with active coaching and mentoring to assist the development of emerging high-tech companies.
Coleman and Mackworth plan to close their inaugural fund by the end of the year and will begin investing in the first quarter of 2000. The new fund will use capital from institutional and private investors as well as themselves, with the fund size expected to reach $15 million to $20 million. The two executives also plan to access SBIC funds to grow their fund in the future. One of the initial sources of capital is the Oregon Growth Account, a public investment fund formed from lottery revenues to develop startup businesses and venture capital in Oregon. The fund expects to manage $6 million of Oregon Growth Account funds.
“Debi and I have both been active investors in Oregon startup companies. This combination of an early-stage venture capital fund and incubator will let us formalize that process and quickly help convert great ideas into great companies,” said Mackworth.
“This structure is unique in the Pacific Northwest,” said Coleman. “Similar models have been successful in other regions, but we will have a distinct, Northwest style. For example, we will encourage our portfolio companies to be active members of the community through philanthropy.”
The innovative approach of combining a venture capital fund and an incubator will jump-start the critical planning stage to ensure success through expertise and mentoring. Currently, Mackworth and Coleman are working to identify a location for the incubator in downtown Portland. Their new incubator will provide flexible space, shared business services, high-speed Internet access, and meeting spaces as well as mentoring and networking opportunities to accelerate the successful development of entrepreneurial companies. When in operation, they expect to invest and incubate eight to ten companies per year. As the companies grow and need more capital, the partners of the new fund will not only continue to invest but will also connect these companies to their network of co-investment partners in Portland, Seattle, and the Bay Area.
The partners have extensive experience, both operationally as CEOs and as private investors in high-tech startups. This expertise will be leveraged to create and grow successful emerging companies.
Debi Coleman, chair of Merix Corporation (NASDAQ:MERX), is one of the most recognized female executives in technology management. She was instrumental in the early success of Apple Computer, where she served in a variety of executive roles. When she was appointed CFO at age 34, she was the youngest CFO in the Fortune 500. Coleman moved to Tektronix as vice president of materials operations in 1992 and successfully spun off Merix as an independent public company in May 1994. She has made many private venture investments and is an advisor to four venture capital funds.
Hugh Mackworth has 20 years of successful high-tech executive and management experience. He is a prominent member of Oregon's entrepreneurial community as a board member of the Oregon Entrepreneurs Forum, chair of the Capital Access Group for the Oregon Emerging Business Initiative, and founder of the Portland Angel Network, a network of private investors. Mackworth is chair of two Portland startups: Cenquest, a startup funded by Sevin Rosen and Hummer Winblad, that offers online graduate management degree programs, and MedLink, a company offering a Web-based prescription-transfer solution. He formerly served as CEO of Digimarc Corporation, where he led a turnaround at the digital-watermarking venture, which recently filed for its initial public offering. Before relocating from Silicon Valley, he held senior marketing and other management positions at Apple, 3Com, and GammaLink.
New Fund Will Bridge the Funding Gap
According to Mackworth, “Oregon has plenty of 'raw material' in terms of a great base of high-tech employees and technology, but venture capital has not been sufficiently available. ” In 1998, Oregon received only 0.25 percent of the nation's venture capital despite having 1.5 percent of the nation's high-tech employees; a trend that has only partially improved in the first half of 1999. Simultaneously, national venture capital firms are moving to later stage deals in order to absorb the massive amounts of money flooding the venture market. The new fund will help close the early-stage funding gap facing startups in the Pacific Northwest and increase the chances for success of local companies.
About the New Fund
As a combined early-stage venture capital fund and incubator, the new fund will provide an integrated model for nurturing the ideas of innovative, high-tech entrepreneurs in the Pacific Northwest. Based in Portland, Ore., it will concentrate on developing leading-edge products and services at the formative stages by providing capital, expertise, and mentoring. The fund will focus on technology companies such as information technology, telecommunications and semiconductor design, as well as technology enabled companies that are focused on the Internet and e-commerce. The partners, Debi Coleman and Hugh Mackworth, have extensive experience with high tech companies as executives and investors. Their experience includes working at Apple Computer in the early 1980s as well as leading high tech companies as CEOs.