Seraphim Fund I raises nearly $3MM
for early-stage investments in So. California
“Index-style” fund offers compelling criteria for
investors seeking diversification
IRVINE, April 13, 2004 – Seraphim Fund I, LLC, a
first-of-its-kind investment fund developed to fill the niche between
venture capital and angel investments, has raised nearly $3-million for
investments in early-stage companies located in Southern California, the
fund’s managers announced today.
Seraphim Fund I is an “index-style fund,” which makes
it unique in the early-stage asset class and compelling to investors, said
Ben Barak of Seraphim Management, LLC, which will manage the fund. Rather than relying on the expertise of
fund managers, the Seraphim Fund will invest based on specific, objective
criteria which prospective portfolio companies must meet to receive an
investment from Seraphim.
Seraphim Fund I closed March 31 with committed investments of
$2.93-million from accredited investors, many of whom are Tech Coast Angel
(TCA) members. The fund will invest alongside TCA, the dominant source of early-stage funding and guidance for
successful emerging companies in Southern California
In order to meet the objective
criteria, prospective portfolio companies must have received a minimum
investment of $350,000 from TCA members, 10 individual TCA members must
have made investments in the company in the investment round, and a TCA
member must have a seat or observation rights on the company’s board.
“This is an idea that is very compelling for many individual
investors as it enables them to diversify their early-stage investments by
piggy-backing on the collective knowledge of other experienced
investors,” said Barak, who co-manages the fund along with Andrea
Sloan Pink and John
members of the TCA Executive Committee.
“The Seraphim Fund investment strategy clearly struck a
chord with investors. This was
reflected in the response to our fund-raising efforts,” Barak said.
“We exceeded our initial expectations by 100 percent and our fund
minimum by nearly twice that.”
Sloan Pink called the Seraphim fund a “home-grown
idea” that germinated from the collective experience of the three
managers. To develop the investment criteria, Sloan Pink, Kensey and Barak
analyzed TCA deals over the past six years and tempered that data with
their own experience, gleaned from their combined 35 years of angel
“We first researched this idea in 2002 and discovered that
angel investors needed a powerful way to diversify their early-stage
portfolios. This fund meets that
need and provides investors with access to an asset class that is otherwise
very difficult and time consuming to reach,” Sloan Pink said.
By aligning itself closely with TCA, Seraphim Fund I takes
advantage of TCA’s rigorous due diligence processes for potential
investments. It enables an investor to participate in the unique asset
class of start-up companies while being diversified across industry type,
she added. “An investor in
Seraphim Fund will be invested in about 20 companies from different
industries spread across Los Angeles, Orange and San Diego counties.
It’s much more than one person could ever do on their
own,” Sloan Pink said.
focus … for now
The Seraphim family of funds, through its Fund I initially will
focus on investments in Southern
California, but is
not limited geographically for investments by investors. Investors must
contribute a minimum of $50,000, but cannot invest more than $125,000.
Twenty-five percent of the investment is due initially and the balance is
collected in three capital calls over the next 18 months. Seraphim Management, LLC intends to open
Seraphim Fund II more broadly to accredited investors outside of Southern California, Kensey said.
Kensey said an investment from Seraphim Fund I will be a
significant part of the investment round, up to about twenty five percent
of the amount raised. He said that
while venture capital companies affiliated with TCA will not be involved in
these initial investments, they will be notified of the investments and may
participate in future funding.
About Seraphim Management, LLC
Founded in 2004 by Ben Barak, Andrea Sloan Pink and John Kensey, Seraphim Management LLC is a venture fund
management company which currently manages Seraphim Fund I, an early stage venture
fund of nearly $3 million dollars that invests in technology companies in Southern California. (www. SeraphimFunds.com).
About Tech Coast Angels
Tech Coast Angels (TCA) (www.techcoastangels.com) is a
network of individual angel investors who, collectively, are the dominant
source of early-stage funding and guidance for successful emerging
companies in Southern California. TCA members have personally invested more than $49
million in 74 companies since the group’s founding in 1997. Those 74
companies have received $499 million in additional funding from other
investors in both initial and follow-on rounds.
One of the largest and most active angel
groups in the country, TCA’s membership is comprised of more than 200
individual angel investors linked through networks in Los Angeles, Orange County and San Diego. TCA members invest as
individuals, but work together in a highly structured manner to source
promising investment opportunities, conduct due diligence and mentor
companies in Southern California.
The Silver Company for Tech Coast Angels