ExitEvent will host a Twitter chat with Jason Caplain of Bull City Venture Partners on Wednesday, December 9 from 8-9 p.m. Join in or ask a question using the hashtag #EEchat.
Seven startups have joined the Bull City Venture Partners’ portfolio since it closed its first $26 million fund 18 months ago.
And while four of them are based in the Triangle (and two of those spawned from deals in a prior fund), partners Jason Caplain and David Jones have spent a lot of time in Washington D.C. too.
BCVP’s D.C. investments this year were in Full Measure Education and Contactually, and both deals have pretty interesting back-stories. They’re also embedding the Durham venture capitalists further into the growing D.C. startup community.
BCVP got into Full Measure Education’s $5.5 Million Series B round in April because of a pair of longstanding relationships.
Full Measure founder Greg Davies (pictured right) was an early employee at Blackboard, which was among the most successful investments of the once active Durham venture capital fund The Aurora Funds.
Davies had stayed in touch with Erik Rasmussen, a former Aurora principal who was responsible for its investment in Blackboard. When it came time to raise money for Full Measure, which keeps colleges in regular communication with students to curb dropouts and boost graduate rates, Rasmussen, now a senior vice president and managing director of technology at Safeguard Scientifics, led the round.
Rasmussen is also an acquaintance of Bull City Venture Partners, a Durham connection. But BCVP had another link too. The COO of its portfolio company WeddingWire also invested in Full Measure and knowing Caplain and Jones like founders who’ve done it before, brought them into the deal.
The second deal highlights an understated way companies can attract the attention of venture capitalists. If they use your product, and love your product, they’re likely to invest in it.
Though Caplain met Contactually CEO and founder Zvi Band (pictured left) several years ago, it wasn’t until BCVP started using its contact relationship management software (and got a re-introduction from Windsor Circle’s Matt Williamson) that the investors got interested in the company.
Caplain says they tried Salesforce, Google Docs and Asana but Contactually was better for maintaining long-term relationships that aren’t necessarily leading to immediate or regular deals. It was also affordable for a two-person venture capital firm. The software ranges from $30-60 per person per month.
Says Band, “We’re focused on the millions of people who want to stay in touch throughout a career not a job.”
When Caplain saw an uptick in enterprise deals, along with the wide range of industries using the software, he saw a multi-billion dollar opportunity. Contactually is now BCVP’s fastest-growing portfolio company in terms of revenue. The Durham group co-invested in an $8 million Series A, which closed in November, with the likes of Rally Ventures, 500 Startups and Grotech Ventures (whose general partner Don Rainey is known to spend time in the Triangle).
It also could lead to more BCVP dollars flowing into D.C.
Band was in town in November to serve on a couple of panels at Raleigh’s Internet Summit. When we met, he shared with me his belief in the value of being “a big fish in a smaller pond,” along with the popular phrase, “A rising tide lifts all ships.”
He lives that out as one of the most active entrepreneurs in D.C.’s tech community. He co-founded the online directory and tagline, ProudlyMadeInDC, along with the DC Tech Meetup, which attracts north of 700 people every month. He’s also a mentor at the large startup campus called 1776, and he teaches classes at the startup/code education school General Assembly.
All of that is attractive to Caplain, who says he or Jones is now in D.C. every other week to take meetings or attend events.
“(Zvi’s) part of the fabric of the community, so he’s a magnet there,” Caplain says. “I’ve already got deal flow from him.”
For more on the Contactually deal, and a local and national venture capital update to kick off the new year, be sure to RSVP for BCVP’s annual Entrepreneurs Series event in January 2016.
Already confirmed as speakers are North Carolina State Treasurer Janet Cowell and national VCs Eric Koestner of D.C.-based NextGen Angels, who plans to open a chapter in the Triangle; Mike Elliott of Atlanta’s Noro-Moseley Partners, a Motricity and Appia investor; and Alex Pessala of D.C.-based Middleland Capital, an investor in WedPics, Seventh Generation and Contactually. Invites go out next week.
Here’s video from last year’s event:
For more insights into venture capital strategy, investment criteria and other startup funding trends, don’t forget to participate in next week’s Twitter chat with Caplain, December 9 at 8 p.m.