ONSET Ventures closes $200m fund

The Menlo Park early-stage venture investor’s seventh investment vehicle will focus on information and medical technology-based startups.

Menlo Park, California-based ONSET Ventures has closed its latest fund ONSET V on $200 million (€149 million).

The fund is smaller than ONSET’s previous fund that closed in April 2000 on $285 million. According to general partner Mark Hilderbrand, most of the firm’s limited partners have stayed with ONSET for the past 15 to 20 years. The bulk of investors are foundations and endowments with a few larger institutions, and about a quarter of those or non-domestic. “There’s a lot of interest [abroad]. We are a small fund and not aggressively trying to expand.'

The new fund, ONSET’s seventh investment vehicle since the firm’s founding in 1984, will continue to focus on information and medical technology-based startups. Hilderbrand says the fund’s focus will include medical device, drug delivery, communications and software companies.

“It a turbulent landscape, and we feel good about our positioning,” he says. “What we see is a movement toward a more professionalised industry with tremendous amounts of capital. … ONSET tends more toward specialisation in one particular area that we’re uniquely qualified at to drive value.”

Hilderbrand says ONSET’s portfolio isn’t typically that large, and the firm tends to invest in one or two new companies per partner per year.  “The objective here is to have more resources at fewer companies to increase or probability of success.”

ONSET has backed almost 100 companies during its lifetime, and with the addition of the new fund, claims more than $700 million under management. The firm stresses a “shirt-sleeves” style of investment with entrepreneurs by leveraging ONSET’s partners’ operating experience to mitigate risk.

Most recently, the firm participated in an $8 million series A financing of ClariPhy Communications, a fables semiconductor company specializing in high-speed communications ICs.