Harvard backs VC veterans on new fund

Redwood City, California-based Garnett & Helfrich Capital, a ‘venture buyout’ specialist, will focus on spinning out underperforming and non-core units of tech companies.

Redwood City, California-based private equity firm Garnett & Helfrich Capital has raised a $250 million (€211 million) debut private equity fund, the firm announced today.


The new fund, described by Garnett & Helfrich as a ‘venture buyout’ vehicle, will focus on buying out underperforming and non-core businesses, product lines, and divisions from public companies in the communications, Internet, media, semiconductor and software sectors. Investee companies will have ongoing annual revenue of $20 million to $100 million.


The firm was founded last year by managing directors Terry Garnett and David Helfrich. The fund attracted an all-star roster of limited partners including Harvard Management Company, the ‘lead limited partner,’ according to the release. Harvard and consultant Grove Street Advisors contributed to the formation of the firm.


Other LPs include Stanford Management, HarbourVest, RHO Management, University of Michigan, Columbia University, Comprehensive Financial Management, Capricorn Holdings, Park Street Capital and Silicon Valley Bank.


Garnett was a general partner at New York venture capital firm Venrock Associates from 1995 to 2003. Helfrich was an early investor in ComVentures, a communications venture fund.


Garnett & Helfrich is “exactly the kind of new fund managers that we want to back and put in business,” said Peter Dolan, director of private equity at Harvard, in a statement. “Garnett & Helfrich Capital can be built into a franchise fund addressing a newly emerging investment category, venture buyouts.”


According to a spokesperson, the ‘buyout’ aspect of the new fund refers to the controlling stake Garnett & Helfrich will take in businesses. The ‘venture’ aspect is the firm’s deep involvement in restructuring the management and operations of portfolio companies, not to mention the firm’s heavily tech focus.