Boston Consultant Preps $50M Early-Stage Venture Fund

There is an increasingly popular sentiment among today’s entrepreneurial class that failure should not be viewed as an end, but rather as a giant step toward success.

That is the attitude of Charles Collier and Christopher White, partners and co-founders of Boston-based consulting firm Mount Vernon Strategies (MVS), who recently began marketing a $50 million venture fund.

Undeterred by a busted plan to franchise Au Bon Pain eateries in Israel, the duo opened the consulting shop in 1994 and look back on the pain associated with their first joint venture as part of the engine driving their current success.

“I did a lot of soul searching when that deal imploded,” White said. “But it also strengthened my resolve and Charles’ [resolve], I think, to succeed in this business and help others succeed where we ourselves might have failed.”

While to this point that aid has been limited to helping start-up technology companies devise business plans and develop relationships with venture capital firms, White and Collier are currently working to build a $50 million venture fund as an unaffiliated spinoff of MVS. The move is a significant progression from the 1% to 3% equity stakes that MVS has taken in a handful of its clients.

The new fund, to be known as Mount Vernon Equity Ventures LLP(MVEV), will invest primarily at the seed level or just beyond in business-to-business technology outfits. Initial investments will be between $500,000 and $2 million.

Not only is this early-stage focus intended to help investors get in on the ground floor, but it should also help ease any strain put on the consulting arm’s existing venture capital sources. “I think that the venture capital firms that currently recommend MVS for consulting will use the fund’s activities as a sort of due diligence on new companies, since we’ll be in so early,” said Kevin Murphy, who will head up MVEV and was the former chief operating officer of Ocean Spray Cranberries Inc.

“It will hopefully be a symbiotic relationship where our involvement will validate a start-up in the eyes of other venture capitalists,” Collier added.

Not Just Consulting

Such validation, however, will be predicated on more than just the collected consulting expertise of Collier and White and the corporate wisdom of Murphy. Indeed, the fund has been structured as a full-service outfit with other active partners hailing from the strategic marketing, legal and venture capital worlds.

“If you cut open a lot of venture capital firms, you’ll often see people with similar investment banking backgrounds,” Murphy said. “I think that we might fill an attractive niche by having people with strategic marketing backgrounds who really understand how to build a brand.”

Additional partners include former Arnold Communications Chief Executive Lynn Rotundo, Connecticut venture capitalist Tom Clark and a lawyer who couldn’t yet be identified. Of the six general partners, only White, Collier and Rotundo will have equity stakes in MVS with everyone benefiting from the success of MVEV.

Collier said that the fund expects to add the first company to its investment portfolio by July. He also reported that investor interest has been very strong.