DiNapoli Allocates $15M for Appleseed Initiative to Target
Early-Stage & Seed Investments
The New York State Common Retirement Fund (the Fund) allocated $15 million to create the High Peaks Seed Venture Fund, the Fund’s preliminary allocation of the Appleseed Initiative which targets early-stage and seed private equity investments, State Comptroller Thomas P. DiNapoli announced today.
“New York state is rich with top-notch universities and researchers who make breakthrough developments in technology and science every day,” DiNapoli said. “While so many innovative ideas are conceived in New York state, the opportunities to make these ideas into reality are often outside of the New York’s borders.
“With High Peaks, we are creating the Seed Venture Fund to help bridge the gap from concept to commercialization so these cutting-edge products can come to fruition in the place they were born. We can do well for the members of the Retirement System while at the same time do good for New York’s entrepreneurs, researchers, and most importantly New York’s economy.”
The Seed Venture Fund is intended to help New York state-based university researchers and other entrepreneurs transform their ideas into commercial products. It is the Fund’s first commitment to a dedicated seed-stage fund. The Seed Venture Fund will be administered by High Peaks Venture Partners. High Peaks expects to attract an additional $5-$10 million from other investors for the Seed Venture Fund.
“Seed-stage funding is often the most difficult form of investment for young start-ups to acquire,” Bela Musits, managing director of High Peaks, said. “The availability of seed funding is a critical ingredient in building successful start-up businesses. With the establishment of the Seed Venture Fund by Comptroller DiNapoli, access to these scarce funds will now be available to entrepreneurs across New York state. High Peaks Venture Partners looks forward to working with entrepreneurs and making seed-stage investment throughout New York state.”
The Seed Venture Fund is part of the In-state Private Equity Program’s Appleseed Initiative. Last year, DiNapoli held nine events across the state to introduce the Fund’s investment partners to New York businesses and entrepreneurs seeking private equity funding. More than 200 companies contacted the Fund and its investment managers as a result of those meetings. Feedback from conversations with these businesses and entrepreneurs highlighted that there is a lack of early-stage and seed funding available in New York. Through the Appleseed Initiative, the Fund will explore ways to increase investment opportunities in seed-stage companies.
Through the In-state Private Equity Program, the Fund invests with private equity managers who seek to invest in companies in New York state that require capital for growth. The program targets investment of state funds in the New York state economy. The program is designed to provide investment returns consistent with the risk of private equity while also expanding the availability of capital for New York businesses. The program aims to help generate jobs and private sector investment in the state.
To date, $480 million has been invested in 155 companies through the In-state Private Equity Program. The Fund has achieved a 30-percent rate of return on the investments it has exited. DiNapoli added $518 million to the program since he took office in 2007, bringing the total amount committed to the program to $971 million. The Fund has approximately $490 million available to invest in New York-based companies.
About the Common Retirement Fund
The New York State Common Retirement Fund is the third largest public pension plan in the United States with more than one million members, retirees and beneficiaries from state and local governments. The Fund has a diversified portfolio of public and private equities, fixed income, real estate and alternative instruments.
About High Peaks Venture Partners
High Peaks Venture Partners is a seed and early-stage venture capital firm focused on partnering with talented entrepreneurs to build market leading technology companies. High Peaks draws on the extensive networks and experiences of its investment team and advisory resources to proactively identify high potential opportunities, develop strong relationships with and invest in the most promising amongst them, and work tirelessly with its portfolio companies to maximize their prospects for success.
High Peaks is based in upstate New York and focuses on investing across New York state from Manhattan to Buffalo. High Peaks invests primarily in the digital media, internet-enabled business services, communications, and medical technology sectors, and seeks businesses that are introducing disruptive models that will enable them to rapidly grow to market leadership positions.