Pentech Ventures, a GBP12 million fund targeting early stage investments primarily in software in the UK, with a Scottish bias, has been launched by its manager Penta Capital. Craig Armour at Penta Capital has been keen to get such a fund off the ground for some time, with his collaborator Ian Ritchie, who sits on Pentech Ventures advisory board.
The GBP12 million in commitments thus far comes in part from Penta Capital’s existing fund and in the main from a number of high net worth investors. The fund, which is structured as a conventional limited partnership, is expected to close at between GBP15 million and GBP20 million and take three years to invest.
Pentech will invest between GBP250,000 and GBP1 million in early stage technology companies that have created strong intellectual property with high software content. The focus will be on voice, infrastructure, telecoms, development tools, publishing and software solutions and financial analysis tools.
On a day to day basis the fund will be run by technology entrepreneur Eddie Anderson, who joins the board of Penta Capital, and David Armour, formerly a partner in corporate advisory firm AMCo.
Andersen, co-founder and director of Pentech Ventures, was previously co-founder and CEO of Objective Software Technology (OST), a company specialising in software development tools. OST was sold to Nasdaq-listed Wind River Systems Inc in 1998. Andersen also serves on the board of Applied Generics.
Armour, director of Pentech Ventures, is a chartered accountant who has spent the past five years focusing on the technology sector advising on a variety of deals in sectors including software development, telecoms, biotech, opto-electronics, computer systems development and IT management services.
Pentech Venture’s five strong advisory board is made up of Peter Denyer, Nick Felisiak, Ian Ritchie, Robert Thomson and Donald C “Smokey” Wallace.
Denyer was founder and CEO of VISION, a Scottish technology company that he took to IPO in 1995 and sold to ST Microelectroncis in 1999. VISION developed and sold CMOS image sensors.
Felisiak was co-founder of Spider Systems, where he was initially technical director and then software architect. He negotiated and funded the buyout of the Spider Software business after Spider Systems was acquired by Shiva in mid 1995 and went on to become chairman and CTO of Spider Software. Since Spider Softare’s acquisition by Artesyn Technologies in March last year Felisiak has remained with the company on a part time basis.
Ian Ritchie was active in the start-ups of and serves as the non-executive chairman of: Voxar Ltd (Edinburgh), Orbital Technologies Ltd (Edinburgh), Active Navigation Ltd (Southampton), and Digital Bridges Ltd (Edinburgh). He is also deputy chairman of VIS Interactive plc (Dunfermline).
Ritchie’s entrepreneurial streak started in 1984 when he founded and managed Office Workstations Ltd (OWL) in Edinburgh and its subsidiary OWL International Inc in Seattle from 1985. OWL became the first and largest supplier of Hypertext/Hypermedia authoring tools for personal computers based on its Guide product. OWL was sold to Matsushita Electrical Industrial (Panasonic) of Japan in December 1989.
Thomson was founder and CEO of Nasdaq-listed Hyperion Solutions. He retired from Hyperion’s board of directors in 1998. He lives in Bermuda and is an active business angel on the US East Coast and in Scotland.
Wallace has worked in Silicon Valley for 29 years and in the computer industry for 38 years. He is co-founder and Senior VP of Development of MercuryImmediate.
Thomson and Wallace make up an important US component of Pentech Ventures. Ian Ritchie, Pentech advisory group member, said: “Technology companies often sell out too early, usually before they have cracked the US market. We want to help them scale their businesses as fast as possible to maximise value.”
Penta Capital was formed in late 1999 and began fund raising in earnest in the spring of last year. David Calder, Mark Phillips, Torquil Macnaughton and Steven Scott, as pictured were the co-founders of Penta and had left NatWest Development Capital together to go it alone. Penta Capital eventually surpassed its GBP100 million first fund target.