Partners and Access back IDG Ventures Europe spin-out

The management team of IDG Ventures Europe, the European venture capital arm of US-based IT media group International Data Group, has spun out from its parent company and renamed the business Acacia Capital Partners.
 
Swiss-based alternative investment specialist Partners Group and French fund of funds investor Access Capital Partners backed the buyout with an undisclosed sum of capital.
 
Ajay Chowdhury, general partner at Acacia Capital Partners alongside Hitesh Mehta and Chris Smart, told PEO that the firm will manage the $100 million (€78 million) IDG Ventures Europe fund, which has now been renamed Acacia I. 
 

Mehta: heading up Acacia Capital Partners alongside Chowdhury and Smart

Chowdhury said that the fund is now approximately 50 percent invested and the buyout has provided funding for the existing portfolio as well as new investments. “We will follow a similar sector focus to IDG Ventures Europe, but as we’re halfway invested, we’ll probably look at slightly later stage deals in European technology companies, in particular in the UK, Ireland, France and Germany,” he said.
 
Acacia Partners has available capital for a further four or five investments, said Chowdhury.
 
Acacia I has invested in five companies to date, one of which has been exited. In April, Microsoft paid an undisclosed amount to acquire UK-based video game developer Lionhead Studios.
 
The portfolio currently comprises London-based wireless music business Shazam, which sold part of its business to BMI last year; Empower Interactive, a UK wireless messaging infrastructure company, which raised $18 million (€23 million) in a March financing round led by Scottish Equity Partners; Level 5 Networks, a Cambridge, UK- and California-based ethernet chip company, which recently merged with Californian fabless chip company Solarflare; and Automsoft, a Dublin-based process control database business.
 
Chowdhury said that talks with IDG regarding separating the European business began some time ago, but declined to comment on IDG’s position on the move. “Corporates in a VC world have very different agendas from traditional VC partners, but when they said they were keen on the move we were very happy as it allowed us to buy the whole business outright and be independent,” he said.
 
Chowdhury said that, at present, Acacia Partners is comprised of its three general partners and support staff and was taking a “wait and see” approach regarding recruiting further investment professionals going forward. The firm is not expected to begin raising a new fund until next year, added Chowdhury.
 
In March, Partners Group and F&C Private Equity Trust acquired Dresdner Kleiner Wassestein’s £60 million interest in Kleinwort Capital Partners IV. London-based Kleinwort Capital was later renamed August Equity.