January 8, 2014 @ 12:37 pm

Plymouth Venture Partners Fund II Makes Follow-on Investments in Four Portfolio Companies in Q4

Ann Arbor, MI— Plymouth Ventures had an active fourth quarter making follow-on investments in four of its portfolio companies out of Plymouth Venture Partners Fund II. These investments were in the following companies:

InContext Solutions – a software company that supplies virtual simulation software to the market research industry, based in Chicago, Illinois. www.incontextsolutions.com
365 Retail Markets – a Troy, Michigan-based software and hardware provider to vending operators that are putting in unmanned “smartshops” into locations currently served by large vending machine banks. www.365retailmarkets.com
UICO – a multi-featured touchscreen developer that provides highly durable touchscreens that can be used with gloves and while wet, based in the Chicago suburbs. www.uico.com
IDV Solutions – a visualization software company that specializes in the physical security space. Multiple Fortune 100 companies use IDV’s product to manage their physical security operations. IDV is based in Lansing, Michigan. www.idvsolutions.com


Each of these companies was funded in response to their significant growth opportunities. Mark Horne, Plymouth Venture’s Chief Executive Officer, commented, “As the PVP II portfolio continues to mature, we are pleased to see our companies grow and develop new opportunities for investment. We love to put more money to work with these winning teams. Each of these companies has created significant value since we originally invested in them. We are excited to partner with them and continue to fund their growth.”


About Plymouth Venture Partners II, L.P.
Fund II is a follow-on fund to Plymouth Venture Partners Fund I. PVP I became fully invested in 2009 after completing investments in 29 companies. Plymouth Venture Partners II invests in growth stage companies in the Great Lakes region. For more information, please visit www.plymouthvc.com.


About Plymouth Ventures
Plymouth Ventures is the manager for Plymouth Venture Partners I and Plymouth Venture Partners II. The company has four partners, Mark Horne, Ian Bund, Jeff Barry, and Kevin Terrasi. It is headquartered in Ann Arbor, Michigan. For more information, please visit www.plymouthvc.com.



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June 27, 2013 @ 4:53 pm

Beringea Invests In Wood Processor And Recycler Fiber By-Products Corporation

Beringea, LLC, a private equity firm providing growth capital to market-leading businesses, has led a recapitalization of White Pigeon, Mich.-based Fiber By-Products Corporation (FBP), a processor, recycler, and manufacturer of wood products. Beringea’s investment will enable FBP management to pursue an expansion of the company’s footprint and operating capacity.


FBP is a leading recycler of wood waste generated from a variety of end-product markets. The company provides wood waste producers a cost-effective and environmentally-friendly solution to disposing of their waste. FBP then processes it into consumable products, including animal bedding, boiler fuel, wood mulch and premium wood pellets used to heat homes and businesses.


“Fiber By-Products is a leading manufacturer of wood pellets in the Midwest region. Given that this form of heating fuel is environmentally friendly as well as a cost efficient alternative to fossil fuels such as heating oil or propane, the market is steadily growing and the company is seeing increased demand for its product. Fiber By-Products is a Michigan clean technology company that offers consumers a truly sustainable source of fuel.  We’re pleased to support them in their next phase of growth,” said David Ruby, principal at Beringea.


FBP was founded in 1992 by the late Dale D. Schrock with his wife Barbara on their family farm in Goshen, Indiana. His four sons currently manage the business; Chad Schrock, CEO of the company said “the family feels very blessed to see our father’s years of hard work and risk pay off. Furthermore, we are looking forward to our new partnership with Beringea. Their experience working with growing, small businesses is a perfect fit for us. We are excited to see how far we can take the company.”


About Fiber By-Products

Fiber By-Products Corporation is a processor, recycler, and manufacturer of wood products. Since 1991, FBP has been the link between wood waste producers and wood by-product end users. The Company provides wood waste producers an environmentally friendly and cost-effective approach to disposing their waste. Once the waste is collected, FBP recycles and processes it into consumable products, including animal bedding, boiler fuel, wood mulch and, since 2006, premium wood pellets used to heat homes and businesses. The Company manufactures and sells more than 60,000 tons of pellets annually. For more information, visit www.fiberby-products.com.


About Beringea

Beringea, LLC provides growth capital to market-leading businesses. Founded in 1988, Beringea, LLC is headquartered in Farmington Hills, Michigan. Beringea, LLC’s affiliate in London, UK is Beringea LLP. Beringea, LLC and Beringea LLP invest in portfolio companies operating in a range of sectors, including health care and life sciences, clean technology, advanced manufacturing, media, Internet technologies and specialized consumer products.


With capital, experience and offices in the U.S. and UK, Beringea’s team offers its portfolio companies the resources to develop strategy, evaluate growth opportunities and build value. For more information, visit www.beringea.com.


In the United States of America, Beringea operates as an SEC-registered investment advisor, Beringea, LLC. In the United Kingdom, this document is issued by Beringea LLP, a firm authorized and regulated by the Financial Conduct Authority. Beringea LLP is a limited liability partnership registered in England and Wales with company number OC342919, and its registered office is at 39 Earlham Street, London, WC2H 9LT, UK. This document is intended solely to provide information regarding Beringea’s potential financing capabilities for prospective portfolio companies.

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June 24, 2013 @ 8:26 am

New Michigan Angel Fund Offers New Opportunities for Funders, Startups

Michigan Angel Fund

The Michigan Angel Fund (MAF) is a for-profit, professionally managed equity fund focused on capital efficient early stage companies located in Michigan. It is a $2 million fund that, with nearly 70 members, is the largest angel organization in Michigan.


“There are two really unique aspects to MAF,” explains managing director Skip Simms.  “MAF flipped the traditional angel model on its head by raising a fund first, reaching out to existing angels around the state, and people new to the angel community.


MAF is looking to fund companies that need $1-4 million in total investment to get to profitability.  “Most VCs aren’t interested in these investments because these companies are too small,” Simms explained.  “In reality, the majority of startups don’t need the amount of capital that can generate the size returns a VC needs.  We believe these smaller companies can still generate significant outsize returns comparable to VC returns on an IRR basis, just smaller dollar amounts.”


MAF is also unique because its managing member, Ann Arbor SPARK, is a non-profit economic development organization that provides support to the fund and its funding recipients.  Ann Arbor SPARK, as managing member, coordinates screenings of fund applicants, conducts due diligence, and works with the New Enterprise Forum to prepare companies for their investor presentations.  Ann Arbor SPARK also handles back office work on behalf of MAF.


“People wonder why Ann Arbor SPARK, an economic development group and non-profit, decided to create a for-profit identity and get in to managing an angel fund,” Simms said.  “If you look back a few years ago, it was apparent that the companies Ann Arbor SPARK and other groups were helping were all struggling to raise funds, mostly because they didn’t need a large investment, and weren’t quite right for VCs.  On the flip side, Michigan is a top 10 state for high net worth individuals, yet we didn’t have a lot of angels investing in these companies. We need to develop an angel funding culture. By supporting MAF, Ann Arbor SPARK brought more individuals in to the angel arena, and made it easier for startups to find capital in the state.”


Startup BioPhotonics Solutions is the first company to benefit from MAF’s focus on Michigan businesses.   The company, a Michigan State University spin out venture, is developing technology that automated the process of shaping and compressing ultrashort (femtosecond) laser pulses, ultimately improving their utility.  In addition to funding, MAF helped find BioPhotonics’ CEO Kyomi Monro.


“It’s important that MAF have an active role in its portfolio companies; by having a hands-on approach, MAF delivers valuable support beyond just funding the business,” Simms said.  “The angel community backing MAF offers a very diverse and significant depth of experience that can be a big help in getting a startup on the fast track to success with the connections and wisdom of its members.”


Going forward, Simms said that MAF will shift its focus from closing the fund to making investments.  “A year from now, we want to have six to eight companies in our portfolio,” he explained.  “At that point, we can begin thinking about raising another fund to keep MAF going.  The true measure of our success in a year is whether MAF’s 70 investors are happy with the program, its process and want to keep it going and keep making great things happen here in Michigan.”

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June 13, 2013 @ 8:11 am

RTI Biologics to Buy Implant Maker Pioneer Surgical for $130M Cash

RTI Biologics Inc. has agreed to buy medical technology firm Pioneer Surgical Technology for $130 million in cash as the maker of biologic implants looks to expand its current implant portfolio into metals and synthetics and to grow direct distribution.


Based in Marquette, Mich., publicly traded Pioneer makes metal and synthetic products in the orthopedics, biologics, spine, trauma and cardiothoracic markets.


Pioneer had raised at least $45 million from venture investors. in 2008 it raised $15 million in Series B financing led by InvestMichigan Growth Capital Fund, joined by existing investors Highlander Partners, Hopewell Ventures, Pharos Capital Group and River Cities Capital Funds. It earlier raised a $30 million Series A round in 2006.


The deal will give RTI a more diversified business through the addition of metal and synthetic devices, including a synthetic biologics platform, while maintaining the company’s natural biologics implant portfolio.


It will also expand RTI ‘s international reach while simultaneously bolstering its U.S. distribution network.


“This acquisition is strongly aligned with RTI ‘s long term strategic plan, accelerating new growth opportunities and gross margin expansion,” RTI Chief Executive Brian K. Hutchison said. “Pioneer has built a strong distribution network for their implants, which will be beneficial when we launch our map3 cellular allogeneic bone graft later this year.”

After the merger transaction is complete–likely in the third quarter–Mr. Hutchison and Chief Financial Officer Robert Jordheim will continue to serve in their respective roles. The combined company will be based in Alachua, Fla.

RTI also agreed to a $50 million private placement with Water Street Healthcare Partners. TD Bank, TD Securities $80 million senior secured facility, including a $60 million term loan and a $20 million revolving credit facility.


Write to Saabira Chaudhuri at saabira.chaudhuri@dowjones.com

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June 10, 2013 @ 7:12 pm

Mercatus Introduces FICO Score Equivalent for Energy Projects, Raises $2M Series A

Ann Arbor-based Augment Ventures was part of a recent $2 million Series A investment in Santa Clara, Calif-based Mercatus.  Mercatus offers Origination and Syndication Management for the energy project finance industry, helping investors make asset-class portfolio decisions.

Of the investment, Augment Ventures founder and managing director Sonali Vijayavargiya said, “Mercatus is well-positioned to transform analytics for distributed energy generation projects by delivering consistent, traceable and measurable metrics to investors and project developers. Rapid deployment of Mercatus will bring standardization to the investment process and documentation, resulting in faster capital allocation, increased return on capital and much needed liquidity to the sector.”


As distributed generation projects eclipse utility-scale, investors turn to Mercatus for a single point of truth

Santa Clara, Calif. – June 10, 2013 – Mercatus, Inc., a provider of Origination and Syndication Management for energy investors, today announced that it has raised a Series A funding round totaling more than $2 million. Led by Vision Ridge Partners, the round includes investment from Augment Ventures and Shah Capital. Since its 2009 inception, Mercatus, formerly SCS Renewables, has assessed over 3.2 GW of solar projects, while enabling $250M in investments and transactions. It currently serves more than 40% of the U.S. commercial and utility solar markets and counts the industry’s top global developers, institutional investors and independent power producers as customers.


“Today’s distributed energy industry is facing a significant challenge: how to rapidly deploy capital to projects,” said Reuben Munger, Managing Partner at Vision Ridge Partners. “By applying best practices and standardization to this critical piece of the value chain, Mercatus is accelerating fund decisions and enabling the creation of effective pooled investment vehicles.”


The Industry’s First FICO Score Equivalent for Energy Projects

The energy world has seen massive shifts in the last 12 months. While cost of technology and installation have fallen dramatically, one factor has remained constant—the high cost of financing. Developers, tasked with originating bankable projects, are failing to attract capital as evidenced by abysmal closure rates of 3-5% annually. And energy investors, lacking the resources, best practices and in some cases, domain expertise, to make expedient decisions are simply not deploying capital.


To solve this gap between the two worlds, Mercatus introduced Origination and Syndication Management. Based on four years of due diligence and transactions with 40 of the top U.S. financial organizations, the Mercatus platform translates those key investment and underwriting criteria into the first consistent and common language for developers and investors to assess, appraise and ultimately syndicate project portfolios. Developers simply load project information onto the Mercatus platform and 48 hours later, the project receives the industry’s first FICO score equivalent, which is visible to developers and investors alike. The Mercatus platform is based on a proprietary appraisal methodology that rates eight key categories, which provides a holistic assessment of each project’s economic and risk profile and acts as a single point of truth for investors as they race to find the best projects. Developers, who once struggled to understand investors’ criteria for bankability, now have a transparent view of what makes a project financeable, while energy investors looking to find the best projects first depend on the Mercatus FICO-like score to accelerate decision-making and reduce diligence inefficiencies for optimal aggregation and syndication.


“As Wall Street begins to eye the industry as an emerging asset class, a sophisticated solution for end to end Origination and Syndication Management is needed to help the industry reach its full potential, both as a mainstream source of distributed generation and a viable asset class,” said Haresh Patel, CEO of Mercatus. “Our comprehensive solution slashing financing costs of energy projects by up to 50% and provides a bridge for more than $35T of institutional investment into energy infrastructure projects.”


About Mercatus

Mercatus is a leading solutions provider for the energy project finance industry, offering Origination and Syndication Management for investors looking to making asset-class portfolio decisions.  Answering the call for deal standardization, Mercatus has introduced the energy industry’s first project appraisal —or single point of truth—of each project’s risk and reward score. Mercatus’s new standardized approach to the appraisal, aggregation and syndication of individual projects provides the critical transaction interface the buy and sell sides have been waiting for. Please visit us at www.gomercatus.com.



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May 24, 2013 @ 9:03 am

Renaissance Venture Fund

Chris Rizik and Jeff Rinvelt

Chris Rizik and Jeff Rinvelt

With a relatively late start, Michigan’s venture capital community spent the early 2000s playing catch up to the leaders of the national venture scene, not redefining it.   But the 2008 creation of Michigan’s first private venture capital fund-of-funds was so revolutionary it made waves that continue to reverberate around the country and established our region as model for innovative venture fund creation.


Formed in association with Business Leaders for Michigan and with the backing of some of Michigan’s largest corporations, the $45 million Renaissance Venture Capital Fund I was hailed as a new model for fundraising.  The private sector could improve on the long-used public economic development model, using a fund of funds vehicle to earn strong returns, increase venture capital activity in a region and improve the portfolio’s chance of success by giving young companies invaluable direct access to their largest potential customers in the state—the Fund’s investors.


Renaissance Venture Capital Fund CEO and Fund Manager Chris Rizik describes these kinds of connections as “make or break” for some of the start-ups in his fund’s portfolio, allowing them to gain market traction quickly.  “Venture fund managers do a great job of vetting technology but the difficult piece is validating is the market—is there a customer base out there, and can we bring in a significant customer quickly?  With Renaissance Venture Capital Fund, we’re actually introducing the market to the start-ups.  If we find an interesting investment in the energy space, for instance, we’re one phone call away from DTE Energy.  A first or second customer of that size and profile can mean the difference between a slow climb or a quick ascension into viability.”


The success of Renaissance I led to the $65 million Renaissance Venture Capital Fund II in 2012, whose investors include a base of returning institutions as well as new additions like prominent Michigan businesses Meijer Inc. and La-Z-Boy; the first university to invest, Wayne State University; and three influential Michigan foundations: the Herbert H. and Grace A. Dow Foundation, the W.K. Kellogg Foundation and the McGregor Fund.  Rizik says expanding the investor profile was always the intention of the Fund’s organizers.  “The hope was to make this more than just a corporate-backed fund, involving Michigan institutions that represent many different stakeholders.  Fund I proved that a privately-backed fund-of-funds model could achieve regional impact while achieving solid financial performance for investors, so we were thrilled to widen the opportunity with Fund II.”


Rizik and partner Jeff Rinvelt credit recent strong returns and exits in Michigan for the Funds’ robust deal flow from all over the country, and Rizik says the Funds have doubled original targets for investment dollars attracted into the state.   In fact, the Renaissance Venture Capital Fund model has been so successful that leaders around the country have sought out Renaissance and his team to help replicate the model in their region.


“Cincinnati was a region facing many of the same issues we had in Michigan.  Led by executives from Proctor & Gamble, a group there commissioned a McKinsey Consultants study that suggested they replicate the Renaissance Venture Capital Fund model,” said Rizik. The managers of the resulting fund, called Cintrifuse, asked Rizik to sit on the advisory board and share best practices.


“We’ve helped Cintrifuse, and others who are also attempting to copy our model, because we feel it’s good for us to have complementary regional fund of funds.  And because we know this is a model that can make a huge difference to a geographic region that really needs it—we’ve seen it happen first-hand in Michigan.”

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July 6, 2012 @ 8:14 pm

Grand Angels’ Portfolio Company AzulStar Announces New CEO/COO

At its June 20, 2012, meeting, the AzulStar board of directors unanimously elected Richard N. Brouwer to be its Chief Executive Officer and Chief Operating Officer. Rick is currently Vice President, Information Systems for Prime Distribution Services in Plainfield, IN, a national logistics company with revenue of $67.5M  in 2010.

A Grand Angels portfolio company, AzulStar is a privately held provider of 4G wireless internet and communication services to commercial and government customers.

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The MVCA is a non-profit trade organization designed to bring together venture capital industry participants in the state of Michigan. The organization's goal is to grow and sustain a vibrant venture capital community in Michigan.
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