GRAND RAPIDS — The managers ofMichigan Accelerator Fund Iare seeking to raise up to $5 million from investors to provide further financial backing to portfolio companies.
Four of the Grand Rapids-based venture capital fund’s eight existing portfolio companies may need additional capital in the near future, said co-Managing Director Dale Grogan. Capital raised for the newMAF Opportunity Fund LPcould go to make follow-on investments in those companies, plus one new investment, Grogan said.
Follow-on investments would go to portfolio companies that have demonstrated progress and “have a clear path to a near-term exit” in two to three years, he said.
As Michigan Accelerator Fund I nears full deployment of its capital, managers want to have a so-called “tack-on” fund in place to provide further support for portfolio companies that need it, Grogan said.
“There are some really good portfolio companies in Michigan Accelerator Fund and these companies have capital needs that we can’t fulfill,” Grogan said. “Our bucket is exhausted. We have hungry children that we can’t feed out of our first fund.”