ADVERTISEMENT

ADVERTISEMENT

A local 'angel' investment fund is ready to invest after raising $7 million

The Med City-based Southeast Minnesota Capital Fund, LLC, which was formed by Rochester Area Economic Development, Inc., recently announced this week that it has closed fundraising for its second fund with a total of $7 million in committed capital.

Downtown Rochester Minnesota
Downtown Rochester on Friday, July 1, 2022.
Joe Ahlquist / Post Bulletin
We are part of The Trust Project.

ROCHESTER — After raising $7 million, a second Rochester "angel" capital fund is ready to start investing in “high potential Minnesota start-ups.”

The Med City-based Southeast Minnesota Capital Fund, LLC , which was formed by Rochester Area Economic Development, Inc. , recently announced this week that it has closed fundraising for its second fund with a total of $7 million in committed capital.

Also Read
A La Michoacana Purépecha shop is slated to open Thursday at 28 Ninth Street SE, according to co-owner Francisco Lopez. Its official grand opening celebration will follow over the weekend. La Michoacana Purépecha’s menu has more than 50 flavors of fresh fruit popsicles called paletas and more than 30 flavors of hand-made ice cream as well as yogurt dishes, fruit cups and Mexican snacks.
The largest U.S. home infusion pharmacy firm with locations in every state recently added Rochester Home Infusion to its team.

That’s $2 million more than was predicted, when the creation of the Southeast Minnesota Capital Fund II was first announced in February.

The strategy for the new fund to follow the path forged by the original fund , which invested about $2 million in 14 Minnesota companies since 2018.

The SMCF II managers hope to invest in 12 to 15 new companies in the next three to four years. They also would like to make five to 10 follow-on investments in companies within the SMCF portfolio.

ADVERTISEMENT

SMCF Fund I has invested in local firms, like Vyriad . Vyriad is a quickly growing oncolytic virology company founded by two Mayo Clinic doctors. It is based in a state-of-the-art $9 million headquarters in the Rochester Technology Campus , the former IBM complex, at 3605 U.S. Highway 52 North.

The portfolio of Fund I also includes Ambient Clinical, a medical software company that provides point of care analytical solutions to hospital systems, and Sonex Health, a Mayo Clinic spinoff firm that created and markets an ultrasound-guided surgical device.

David Herbert and Harry Hoffman, who are retired Mayo Clinic business and financial executives, are serving as SMCF’s fund managers. They also oversee company screening and due diligence.

Jeff Kiger tracks business action in Rochester and southeastern Minnesota every day in "Heard on the Street." Send tips to jkiger@postbulletin.com or via Twitter to @whereskiger . You can call him at 507-285-7798.

Heard on the Street - Jeff Kiger column sig

Jeff Kiger writes a daily column, "Heard on the Street," in addition to writing articles about local businesses, Mayo Clinic, IBM, Hormel Foods, Crenlo and others. He has worked in Rochester for the Post Bulletin since 1999. Readers can reach Jeff at 507-285-7798 or jkiger@postbulletin.com.
What to read next
The Otto Bremer Trust in St. Paul awarded organizations in Red Wing, Austin, Winona and Rochester over $400,000 to support charitable work.
Kasson-Mantorville isn't the only school district that's been making changes to their pay for substitute teachers.
Exclusive
Check out this 54-acre property in Spring Grove with both a house and peony nursery for sale for $1.5 million.
The 28-year-old man was taken to Mayo Clinic Hospital-Saint Marys on Saturday with non-life threatening injuries.