Last March, Bill Burnham and Carlos Bhola had their sights set on China. Today, Burnham is back home in the states full-time, while Bhola has all but disappeared into the Far East.
Burnham, a former managing director at Mobius Venture Capital and a onetime renowned e-commerce analyst, was working with Bhola, who founded Vonage and is a longtime private investor, on raising a $150 million fund to invest in China and the United States. The partners coolly called their fund Celsius Capital and, as Burnham described it last year, the pitch was “innovation arbitrage” between the two regions.
Last summer, however, Celsius decided to focus the fund exclusively on China, instead of cross-border investing. “This was the right thing to do because the LP market for China is active and the investment climate for early stage technology remains very promising,” Burnham said.
Celsius is still out fund-raising and has made a couple of interim investments, but the firm will move on without Burnham, who says that the split was a mutual decision.
“The more I thought about it, it didn’t really make sense for me to be part of a China-focused fund, given that my interests and experience lie much more in the U.S.,” he says. “So I decided not to move forward on the China-focused path with the rest of the team.”
In addition to Bhola, the Celsius team includes Tony Lo, a former Mobius associate, and Woo Kim, a onetime associate of 2B, which was Bhola’s private investing firm. They have been joined by a couple of other folks, wrote Burnham in an email to PE Week late last week. Burnham was unavailable for follow-up questions last week, so it’s uncertain who the additional Celsius team members are and what everyone’s role is now that Burnham has severed ties.
Burnham, who left Mobius in 2003 and maintains a regular blog at billburnham.blogs.com, isn’t walking away from the idea of starting a new fund. Rather, he says that he’s working on a new, U.S.-centric, fund, but he declined to discuss details.
In marketing Celsius last year, Burnham and Bhola stressed their credentials to LPs. That strategy has served many other new funds over the last 12 months.
* Last year, Fred Wilson and Brad Burnham (no relation to Bill Burnham) co-founded New York-based Union Square Ventures, which closed its inaugural $125 million fund.
* Shasta Ventures also closed its first ever fund. It boasts Ravi Mohan, Tod Francis and Rob Coneybeer (all former GPs at Battery Ventures, Trinity Ventures and New Enterprise Associates, respectively).
* More recently, former NEA GP Stewart Alsop announced plans to raise a fund with Gilman Louie, the former head of In-Q-Tel.
* And, as first reported last week in PE Week, veterans Jennifer Gill Roberts, of Sevin Rosen Funds, and Marc Friend, most recently of Summit Ventures, have teamed and are also on the fund-raising trail for a new firm they call Maven Venture Partners.
Presumably, Burnham will feature the same LP-friendly management fees that Celsius has been using to attract investors. Celsius, Burnham said last year, would return 100% of committed capital before the general partner participates in any profit-taking.