Thursday, June 07, 2012

(BN) Madrona Venture Group Said to Raise $300 Million for Fifth Fund

Bloomberg News, sent from my iPad.

Madrona Venture Group Said to Raise $300 Million for Fifth Fund

June 5 (Bloomberg) -- Madrona Venture Group, an early backer of Amazon.com Inc., raised a $300 million fund for investments in technology startups, said two people familiar with the matter.

The firm will introduce its fifth fund later this week, said the people, who declined to be named because the closing hasn't been announced. Madrona's previous fund raised $250 million four years ago.

Venture investors are capitalizing on the best stretch of U.S. Internet initial public offerings in more than a decade, which is bolstering returns and helping firms reel in capital. Kleiner Perkins Caufield & Byers announced a $525 million fund last month, following a first quarter that saw firms including Andreessen Horowitz, Canaan Partners and Bain Capital Ventures each raise at least $600 million.

A representative from Seattle-based Madrona didn't immediately respond to a request for comment.

Madrona invests mostly in startups located in the U.S. Northwest. The firm was founded in 1995 by Tom Alberg, Paul Goodrich, Gerald Grinstein and William Ruckelshaus. That year, Alberg invested in Amazon, the biggest online retailer, and he remains a board member of the Seattle-based company.

Alberg and Goodrich are two of Madrona's seven managing directors, up from four when the firm raised its 2008 fund. Recent investments include Rover Inc., an online marketplace that connects dog owners with dog sitters, and RewardLoop, a mobile application that lets users maintain reward points for retailers on their smartphones.

Madrona profited from an early investment in storage provider Isilon Systems Inc., which sold shares to the public in 2006 and was acquired by EMC Corp. for $2.25 billion in 2010. It was also an investor in ShareBuilder Corp., an online brokerage company purchased by ING Groep NV in 2007 for $220 million.

Bloomberg LP, the parent of Bloomberg News, is an investor in Andreessen Horowitz.

To contact the reporter on this story: Ari Levy in San Francisco at alevy5@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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