San-Francisco-based Sofinnova Ventures, which is now the fully independent counterpart of its former French parent, Sofinnova Partners, has completed the raising of its fifth venture fund with over $200 million in capital, exceeding its initial target of $150 million.
Sofinnova Venture Partners V (SVP V) announced its first closing at the beginning of February at $85 million. Managing director Alain Azan remarks that the fund is extremely diversified in terms of its investors, with both old and new players eager to participate in the round. A third of investors in the fund are French participants such as Axa, AGF, CNP, France Telecom-Innovacom, Aerospatiale Matra and Bouygues. A further third of investors come from other European markets, including Private Equity Holding, Vencap, VCM and GIMV. The remaining third come from North America and are said to be first-time investors in a Sofinnova Ventures fund. The firm expects the fund to fund be fully invested in two years in around 30 companies. Investments will range from $1 million to a total of $6 million in successive rounds. Like the previous funds (with the exception of Venture Partners I which focused primarily on information technology), SVP V will target infrastructure for Internet and telecommunications, digital media and product-oriented life sciences. The majority of investments (85 per cent) will be focused on the US, with the remaining 15 per cent being invested in Europe. The fund has competed seven deals, investing in the following companies: Indigo Software, which is developing a software stack and applications based on a new networking protocol; Kxen, which edits and sells data mining engines; Network Physics, a company dedicated to improving Internet traffic; Headsprout, a web-delivered digital learning service; Cornerhardware, an online retailer of home improvement goods and services; PropertyCapital.com, an e-financial services company for commercial real estate financing; and Tensys Medical, a non-invasive arterial blood pressure monitoring system. Another life sciences deal is currently in the pipeline.
Coinciding with the closing of the fund, Sofinnova Ventures in early July added another partner to the team. James Healy joined as managing director with a brief to build an investment practice focused on building successful companies serving medical markets. Prior to joining Sofinnova, Healy was a partner at Sanderling Ventures. Sofinnova Ventures has raised five funds since 1984 and currently has over $330 million of cumulative capital under management. Its latest fund is over twice the size of its previous investment vehicle which closed in 1998 at $70 million.