Investment Advisers Inc., Minneapolis, spun off its venture capital unit in conjunction with the creation of its next venture capital fund, Coral Partners IV.
Yuval Almog, managing partner, said part of the reason for the spinoff was that executives within Investment Advisers have felt the venture capital unit could be better run at an "arm's length" from the advisory firm. He added that the timing seemed to be right with the new fund commencing.
Mr. Almog said the partners in the new firm, called The Coral Group Inc., hope to raise $100 million for the new fund. Two of Investment Advisers' existing venture capital funds, with $100 million in assets, are a part of the spinoff.
A third fund, with $50 million in assets, is managed by Coral but remains with Investment Advisers because it has only a few months to maturation.
Mr. Almog said Coral's investments range from very early stage to special situations for public companies.
It puts a substantial portion of its investments, usually 40% to 50%, in Minnesota firms, and tends to focus on technology and health care companies.
Donald Lucas will be a special limited partner in the new fund, Mr. Almog said.
Others in the Coral Group will be existing Investment Advisers professionals Peter McNerney and Linda Watchmaker. David Koehler, who is also in the venture capital group, plans to retire, and will slowly unwind his involvement in the unit.
- Paul G. Barr