Media Technology Launches $75M Seed Fund

Two months after closing a $155 million fund that invests in early to midstage companies in the media and information technology industries, Media Technology Equity Partners LP is planning to raise $75 million for its second seed-stage fund.

The firm plans to commit the remainder of its first $70 million seed-stage fund in the next few months, and will begin raising the $75 million fund in the fall, said Managing Director Robert Ackerman. Ackerman added that several of the firm’s corporate limited partners are likely to invest in the new fund.

“We have built a broad network of corporate relationships and are looking for these corporations to buy into our vision,” Ackerman said.

The proposed seed-stage fund does not have a minimum investment size. Ackerman said working with less mature companies requires added discipline on the part of the investor.

“We need to work on writing small checks,” he said. “There is a danger in raising to much money too quickly.”

Limited partners in the $155 million fund include Thomson Multimedia, a division of the corporate parent of PEW, MediaOne, Boeing, Freedom Communications Inc., WPP Group plc, GE Equity, NBC, Hearst New Media & Technology, Sonera, American Express and Siemens AG.

The fund will invest between $6 million and $10 million in each portfolio company. Ackerman said Media Partners will invest in companies “that are formed from the convergence of communication content and electronic commerce.” These include wireless and Internet platform telecommunications providers, broadband Internet service providers and e-commerce retailers. Ackerman said Media Partners would consider investing in content companies, but only if their product is a component of larger operations.

“We are not big believers in pure advertising supported revenue models,” he said.

To date, Media Partners has committed $22 million to early-stage companies including Quokka Sports and EC Direct.

“We look for situations where the management team is largely complete, and the company is on the cusp of generating revenues,” he said.