NetCentric Spins $200M Fund

New York’s ever-growing venture capital community took yet another step toward saturation last week as NetCentric Partners announced that it is in the process of marketing a new vehicle dedicated to investing in b-to-b, Internet infrastructure and technology-enabling companies. The fund carries a $200 million initial target, although the bar could be raised if there is a surplus of capital commitments.

“We know that there is a ton of VC money out there right now,” said Aaron Ford, managing partner at NetCentric. “But we’ve set up partnerships with a number of value-added sources like Internet strategists and financial services groups, which will not only help us find good deal flow, but also add value to the deals themselves.”

Ford added that NetCentric’s partnership network will enhance what he believes to be the firm’s greatest asset: speed.

“We have so many resources to tap when we have questions about a company that we’re able to give a much faster turnaround time than other firms,” he said.

This rapid response claim is supported by Paul Nash, chief executive of video streaming company Microcast, which received funding from the NetCentric principals prior to the formation of the new fund. “One of the main reasons that we chose [NetCentric] was because their ability to understand the space enhanced the speed at which we were able to secure funding,” he said.

Microcast is just one of seven companies that the NetCentric principals have played a part in funding since they first got together three months ago. The group, along with a few other select investors, has so far lavished a total of $45 million on Internet firms, with most of the deals being financed via specially designed holding vehicles.

“These deals show that we have a proven track record, and that we can really be a value-added investor as an actual fund,” Ford said.

Although the new fund plans to begin making investments before announcing its first closing, there will be at least one more NetCentric investment the holding company model. Indeed, NetCentric Partners Microcast Holdings will take the lead on a $27 million fourth round for Microcast that is scheduled to close later this week, Nash said.

NetCentric currently has offices in New York and Greenwich, Conn., with plans in the works to open sites in Europe and Asia to support a global investment strategy.