A survival of the fittest challenge has been playing out in Canada this year, and six-year-old Yaletown Venture Partners has apparently been deemed one of the more robust venture outfits by institutional investors. The firm just closed on an initial $65 million for its second fund, Yaletown Ventures II Limited Partnership.
Yaletown closed its first, $42 million fund, in 2003. Its second fund, open to new investors for the next 12 months, is targeting $100 million.
Yaletown’s news will hopefully brighten the day of Canadian VCs, who’ve been confronted by tough economic times in recent months. Recently, 20-year-old Vancouver-based Ventures West Management announced that, unable to raise new funds, it has begun to wind down its operations. Meanwhile, 10-year-old, Ottawa-based Skypoint Capital, which has also struggled to raise a new fund on the heels of its 2001 vehicle, has suspended fundraising, though it’s still hoping to attract new capital at a later date.
Yaletown, which primarily invests in both IT and clean tech in the Pacific Northwest and Canada, doesn’t appear to have enjoyed any exits yet. Evidently, LPs like the stakes that the firm has assembled thus far.
Among Yaletown’s portfolio companies is Austin-based Microstag, which designs and markets intelligent fluid control microsystems and has raised $14.5 million since its 2000 launch; Seattle-based Mixpo, an video software startup that sells to enterprises and has raised $6.5 million, including from Madrona Venture Group; and telecommunications startup Zeugma Systems in Vancouver, which has raised nearly $40 million since its founding in 2003, including from Granite Ventures.