Bull City Venture Partners announced today that it has closed on a new $53 million fund. The fourth fund from the Durham-based VC firm aims to continue investing in software, e-commerce, fintech, and healthcare startups located across the Mid-Atlantic and Southeast.
Fundraising began last year and concluded just a couple of weeks ago, according to General Partner Jason Caplain. There were differences in the process of raising this fund compared to in years past. Although Bull City has successfully closed three funds previously, Caplain said bringing new investors onboard amid the pandemic brought additional challenges.
Many weren’t as willing to meet, Caplain said, but luckily Bull City has an incredibly high number of repeat investors they’ve maintained strong relationships with.
The success of Bull City’s portfolio companies like ChannelAdvisor, The Knot Worldwide, ServiceTrade and Even Financial also likely gave investors increased confidence in adding to the fund. In fact, Bull City Venture Partners saw five successful exits in the last eight months, including Attila Security’s acquisition by ID Technologies and Shutterfly’s purchase of Spoonflower.
“Continuing to prove that the model works gave investors continued confidence in us,” Caplain said. “It’s hard to fundraise without great exits.”
All in all, Bull City’s existing portfolio companies have raised over $160 million in follow-on capital over the past year.
The past year also saw Bull City, originally composed of co-founders and General Partners Jason Caplain and David Jones, add a new face into the fold: Senior Associate Michael Lee. All of this together likely boosted the fund, which is the third oversubscribed fund the VC firm has raised.
Over the years, Bull City’s fund sizes have jumped from $5 million, to $15 million, $26 million and now $53 million. It’s capital growth that Caplain said allows them to make an even larger impact on the companies they invest in.
“This gives us more dollars to invest to be more supportive, and more with each company along the way, which I think is really important, especially in our region where 80% of that capital comes from outside the area,” Caplain said.
Bull City has already deployed a fair share of the capital around with recent investments in product change platform LaunchNotes, Durham-based children’s products rental company Tiny Earth Toys, Raleigh’s AI-powered CRM startup Levitate and tech-enabled title and escrow agency Blueprint Title. Through these investments and others, Caplain said the region will grow economically, which is Bull City’s intended goal.
“Through that, thousands of jobs will be created and it hopefully will help create more exits throughout our region,” Caplain said. “We’re running the same playbook today that we did when we first started.”
Caplain encouraged all interested founders in software and IT-related companies to reach out via email. He said Bull City responds to all the messages they receive. In the past, 70 percent of their portfolio companies have had experienced founders. But the 30 percent who are first-timers were able to stand out in a different way.
“We’re not afraid to invest in first-time CEOs,” Caplain said. “We’re really looking for that founder where we get to feel like we want to quit our jobs to go work with. That’s really important for us.”