Downtown-based Renaissance Venture Capital Fund closes $50 million fund

Venture Capital is beginning to build up some significant muscle in downtown Detroit these days thanks in part to Renaissance Venture Capital Fund closing a $50 million investment vehicle.

The $50 million is the first fundraising effort for the fund of funds, which means it will invest that money into other venture capital firms. The Renaissance Venture Capital Fund, which has co-headquarters in Ann Arbor and Detroit, plans to invest that money into either local venture capital firms or out-of-state VC companies that plan to invest in Michigan businesses.

"Growth will happen in the funds we invest in and the companies they invest in," says Chris Rizik, CEO of the Renaissance Venture Capital Fund.

So far it has invested $6 million (for a total capital commitment of $20 million) in both local firm's (Ann Arbor's Arboretum Ventures) and out-of-state funds that are establishing Michigan offices, such as Florida's Arsenal Venture Partners. Renaissance Venture Capital Fund's investments have resulted in a $23 million cash infusion into 12 Michigan companies, creating about 200 new jobs. Those companies have leveraged that investment to receive over $146 million in further venture funding. These investments have been so successful that Renaissance Venture Capital Fund has already disbursed its first profits to investors.

Rizik expects the fund will commit the rest of its $50 million over the next year or two. Those are deals that are expected to touch 100-150 companies in the state, thereby creating hundreds of new jobs, mainly rooted in the new economy. The 3-person fund, which is looking at adding interns next summer, expects to start fundraising for its next investment vehicle in 2012.

The Renaissance Venture Capital Fund is a private fund led by the Business Leaders of Michigan and funded by a number of large business institutions, such as AAA and Blue Cross Blue Shield of Michigan. Most fund of funds are sponsored with public money.

Source: Chris Rizik, CEO of the Renaissance Venture Capital Fund
Writer: Jon Zemke