Tri-Valley Ventures, founded by six partners including Greg Hitchan and Don Garman, publicly launched the fund last December with a goal of $10 million.
In an interview, Garman said they had been pleasantly surprised by the response and the size of the fund. They will have about 45 limited partners when the fund closes. He noted that the money was invested without hard-core fundraising.
Last week, Tri-Valley Ventures was honored by the Innovation Tri-Valley Leadership Group with its Activator Award. Their goal is to fill the venture gap in the valley, which has plenty of entrepreneurs building businesses by tapping into the great talent base here.
One of the six companies they have invested in—Unchained Labs—was honored last week with a Game Changer award for Pleasanton. Unchained CEO Tim Harkness is one of the five founding partners of Tri-Valley Ventures and arranged for the fund to participate in its fourth round of financing. Typically, Tri-Valley Ventures would invest in the first round.
Garman said that the first investments were all companies they knew or knew the partners. Three of the firms were announced publicly in December.
AEYE combines the LIDAR technology for autonomous vehicles with deep learning algorithms to provide a more reliable vision system for vehicles. It has attracted the attention of major automakers.
Deep Sentinel uses cameras, other sensors, computer vision, deep learning and artificial intelligence to take security systems for homes and neighborhoods to a new level.
No. 3, Swarm Sales, provides sales as a service to connect businesses with sales specialists to close deals more quickly. It is designed to complement or replace an employee or contractor sales group.
In addition to Unchained Labs, the fund invested in Startup Genius and Actionable Science. Startup is a platform that guides entrepreneurs through the process of building their company step-by-step.
Actionable Science uses artificial intelligence to automate business processes such as IT, human resources and customer service requests. It is designed to handle the routine actions and inquiries to free up employees to focus on requests that need human interaction.
As Garman, Hitchan and their partners have worked through the presentations and due diligence around the first-round investments, they have been impressed by how many start-ups are finding them.
Hitch said they had passed on some opportunities because the firms were not ready, but he will continue to help some of them. He shared about a 3D printing firm that he’d met with four times and decided they were not ready for Tri-Valley Ventures yet, but he introduced them to people at Lawrence Livermore who are experts in 3D manufacturing.
The lab has been working on 3D process with the goal of a ship or submarine at sea with the capability of manufacturing a replacement part while deployed.
Hitch believes that hands-on effort will help the venture ecosystem to grow in the valley. They are staying quite busy vetting potential additional companies—“the pipeline is full,” Hitch said. That process will likely run through the second and third quarters. They have a goal of placing the initial investment by the end of this year or the first quarter of 2019.
When Hitch and Garman formed Tri-Valley Ventures, they had a social goal in addition to a financial one. Typically, venture firms make a few people very happy financially. Their goal with the fund is to broaden that so there are 10 times as many happy folks.
“We want to see lots of paddles go up at the benefit auctions for our schools, not just a few,” Garman said. They believe that will result in a much healthier community.
“The mission of Tri-Valley Ventures is a broad, wide tent that makes 60-70 families money, not just a few. We want to create an ecosystem here for start-ups. We see the Tri-Valley as the way Silicon Valley was 50 years ago,” said Garman.