Boosted by an investment from the managing partner of the Sacramento Republic FC soccer team, a Folsom venture capital firm said Tuesday it has reached its goal of raising $25 million.
Moneta Ventures said it has closed out its fund to new investors after wrapping up its deal last week with Kevin Nagle, the lead investor in Republic FC. Nagle said his investment is “in the low millions” and is rooted in his desire to help improve the area’s entrepreneurial climate.
“It represents a paradigm shift, a new generation for investment in the Sacramento region,” he said.
With $25 million, Moneta is relatively small by Bay Area or Silicon Valley standards but is one of the major venture capital firms in the Sacramento area.
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Lokesh Sikaria, a technology entrepreneur and Moneta’s managing partner, said his original goal was to raise $10 million to $12 million. He raised $19 million in a few months last spring and began turning his attention to investing those dollars in startups.
More recently, he’s returned his focus to bringing in additional capital. His most recent investors include Nagle and Chuck Hansen, a Sacramento-area tech entrepreneur and investor. Of the $25 million he’s raised, about $20 million has come from Sacramento area investors.
“We’ve been successful with the fund,” Sikaria said. “A lot of local investors.”
About $8 million of the money has been spoken for. Moneta’s portfolio companies in the region include 5th Planet Games Inc., a Rocklin game-maker; Kura MD, a Roseville telemedicine company; and HomeZada, an El Dorado Hills company that created a system for homeowners to store their important documents. Sikaria said Moneta has a couple of more deals pending that are expected to consume another $2 million or so.
Sikaria said Moneta had to overcome many of the same handicaps that have bedeviled other Sacramento venture capital firms. They include the perception that Sacramento has little in the way of venture capital, forcing entrepreneurs to go elsewhere for their money. At the same time, many Sacramento financiers aren’t aware of the promising tech companies in the area, he said.
“VC’s don’t realize there are good companies in this region,” Sikaria said. “Companies don’t realize there are VCs in the region.” He is founder of a Folsom tech firm called Sparta Consulting, which was sold for $38 million in 2009 to an Indian company called KPIT Cummins Infosystems Ltd.
Nagle is the co-founder of EnvisionRx, a pharmacy-benefits manager with offices in El Dorado Hills, and is a part owner of the Sacrament Kings. He is also a major investor in El Dorado Town Center, a major commercial real estate complex. But he was largely unknown to most Sacramentans until last September, when he became the managing partner of Republic FC, agreeing to lead the minor-league club’s push for an expansion spot in Major League Soccer.
EnvisionRx announced last week it is being sold for $2 billion to Rite Aid. Nagle said he was already looking at investing in Moneta, and would have made the deal regardless of whether Rite Aid bought Envision.