.406 Ventures Caps First Fund at $167 Million; Focused on Massachusetts IT Firms
Dan Primack of Private Equity Hub is reporting today that .406 Ventures, the Boston-based early stage venture capital firm founded in 2005 by local entrepreneurs Maria Cirino, Larry Begley, and Liam Donohue, has finished raising its first investment fund. The firm gathered $167 million altogether, mostly from institutional investors such as Parish Capital.
Primack (one of our favorite financial reporters) apparently nagged Cirino for months for some word about the firm’s fundraising progress, to no avail—for legal reasons, Cirino couldn’t say anything publicly until the fund was closed. But she e-mailed Primack yesterday with the news that the fund had been topped off, at about $17 million over the firm’s initial $150 million target.
.406, which is named after Ted William’s record-setting 1941 batting average for the Red Sox, says it prefers to be the first investor and the lead investor in new, market-changing software and services ventures. One of its three core operating principles is “a commitment to ‘back-to-basics’ venture capital disciplines focused on operational excellence, entrepreneurial spirit and capital efficiency.” Its portofolio companies, which are all based in Massachusetts, include:
- Cambrige, MA-based Bit9, whose software allows IT managers to control which applications run on company desktops
- Boston-based Business Intelligence Advisors, which is applying intelligence-gathering techniques to business research
- Newton, MA-based ChosenSecurity, which provides public-key-infrastructure-based encryption certificates as a managed service
- Boston-based Health Dialog, whose analytics software helps health-care organizations reduce costs; .406′s first exit, the company was acquired by UK-based health insurer BUPA last year
- Concord-based Memento, which makes fraud-detection software for banks and credit unions
- Boston-based Optaros, which creates AJAX-based rich Internet applications for other companies
- Needham, MA-based RatePoint, which helps companies collect customer feedback information online
- Cambridge, MA-based ThingMagic, which makes advanced RFID hardware and software for consumer and industrial applications (see our recent story on ThingMagic’s collaboration with DeWalt and Ford)
- Burlington, MA-based Veracode, which evaluates the binary code behind complex software for security holes (see our January profile).
Cirino told Primack, however, that .406 is open to investment opportunities outside Massachusetts, and that it’s currently looking at a deal in Seattle.