Since 2000, venture capitalist Frank Mendicino has invested nearly $34 million in 21 companies, including technology firms Tendril Networks of Boulder and TensorComm Inc. of Westminster.
Of all those companies, 14 are still in operation, three have been sold and four have been shuttered.
Mendicino, co-founder of Westminster-based Access Venture Partners, is now starting the process all over again. That’s typical for small- to mid-sized venture-capital firms, which temporarily shift between raising money and investing it – a cycle that repeats itself every five years or so.
Mendicino, 40, is currently trying to amass up to $40 million from pensions and foundations, university endowments and wealthy families, including some in Colorado.
At least three other prominent Colorado venture-capital firms say they are in the hunt for fresh capital: Denver-based Centennial Ventures, Boulder Ventures and Sequel Venture Partners of Boulder.
None of the three would disclose how much they intend to raise.
Colorado companies managed to raise just $76.3 million from venture capitalists nationwide during the second quarter. That marked the fourth smallest three-month haul for the state since 2000, trailing only the second and third quarters of 2003 and the fourth quarter of 2004, according to Ernst & Young.
The fundraising efforts of Access, Centennial, Boulder Ventures and Sequel was a factor in the state’s slow second quarter, as those firms temporarily shifted away from making new investments, Mendicino said.
“We only have so much time in the day,” he said. “The fundraising process is necessary, but it sometimes slows down the pace of investing.”
Nationwide, venture-capital firms have raised $11.5 billion in the first half of 2006, 7 percent more than was raised in the same period a year ago, according to a Dow Jones VentureOne study released last week.
“It remains likely that 2006’s fundraising will match or surpass the amount raised last year due to the significant level of interest investors have shown in this asset class of late,” said Stephen Harmston, director of global research for VentureOne.
If that happens, 2006 will mark the biggest year for venture fundraising since 2001, when $49.7 billion was amassed, the study showed.
Mendicino noted that some large venture firms on the East and West coasts raise money almost continuously, while those in Colorado tend to invest most of their capital before raising more. Investors “want you to make sure the money is at work before you raise more,” he said.
Staff writer Will Shanley can be reached at 303-820-1260 or wshanley@denverpost.com.
