Viventures Partners, the venture capital firm launched by Vivendi, has reduced its second fund by 20 per cent. The fund closed at €640 million a year ago and has so far made 21 investments. The firm, which has offices in Paris, London, Silicon Valley, San Francisco and Singapore, joins an increasing number of predominantly US-based early stage funds that have returned money to investors.
Other European funds that have been reduced in size include Softbank Europe Ventures and Benchmark Capital’s European fund – see evcj June 2002 issue. Jean-Pascal Tranié, managing general partner of Viventures, said: “We believe it realistic to acknowledge that the difficult economic climate, which has particularly affected the information technology and telecommunications sectors, calls for a pragmatic investment strategy.”
According to EVCA, there is currently €45 billion of uninvested capital that has been raised by the European private equity industry in recent years. One estimate touted at the EVCA symposium in Athens last week estimated that this could represent just 18 to 24 months supply of capital. Although the majority of this money is in larger pan-European funds there could still be an over supply problem for the venture and the mid-market segments.
Viventures typically invests $3 million to $10 million in early-stage companies in sectors such as telecom and datacom infrastructure, optical components and systems, application software and enabling technologies for wireless and Internet infrastructure. However, Tranie says: “Viventures is actively reviewing opportunities in early stage companies as well as more mature businesses and special situations with attractive valuations.”
A third of the capital of Viventures 2 was provided by VivendiNet, the Internet arm of media giant Vivendi Universal, but the fund also includes commitments from over 30 investors in Europe, the US, Asia and India. Among these are British Telecom, Cisco Systems, Eurazeo, GE Capital, Goldman Sachs, IBM, Mitiska Net Fund Europe, Procter & Gamble, SG Asset Management and Siemens Venture Capital.
The first fund, which was launched in June 1998 and raised $115 million, made 49 investments in IT and telecommunication companies in Europe and the US. Of these investments 50 per cent were in Europe, 40 per cent to 45 per cent in North America and five per cent to ten per cent in Asia. This fund has already returned more than the total contributed capital to investors.