Yaletown holds first close on $65M

Six-year-old Yaletown Venture Partners has closed on an initial $65 million for its second fund, Yaletown Ventures II.

The Vancouver, British Columbia-based firm is targeting the fund at $100 million. Yaletown raised $42 million for its first fund, which closed in 2003.

Yaletown’s news will hopefully brighten the day of Canadian VCs, who’ve been confronted by tough economic times in recent months. Recently, 20-year-old Vancouver-based Ventures West Management announced that, unable to raise new funds, it has begun to wind down its operations.

Meanwhile, 10-year-old, Ottawa-based Skypoint Capital, which has also struggled to raise a new fund on the heels of its 2001 vehicle, has suspended fund-raising, though it’s still hoping to attract new capital at a later date.

Yaletown, which primarily invests in both IT and cleantech in the Pacific Northwest and Canada, doesn’t appear to have enjoyed any exits yet, based on data from Thomson Reuters (publisher of PE Week). Apparently, LPs like the stakes that the firm has assembled thus far.

Among Yaletown’s portfolio companies is Austin, Texas-based Microstag, which designs and markets intelligent fluid control microsystems and has raised $14.5 million since its 2000 launch; Seattle-based Mixpo, an video software startup that sells to enterprises and has raised $6.5 million, including from the Madrona Venture Group; and telecommunications startup Zeugma Systems in Vancouver, which has raised nearly $40 million since its founding in 2003, including from Granite Ventures. —Constance Loizos