Richardson succeeds Castle at MTI

Ernie Richardson has taken the helm as chief executive at UK venture capital firm MTI from founder Paul Castle, who has announced his retirement.

Paul Castle, who established Watford-based venture capital firm MTI in 1983, has retired and will be succeeded as chief executive by Ernie Richardson.

Richardson joined MTI in 1985 having previously held senior positions in the banking and chemicals industries at British Steel, Laporte Industries and Royal Bank of Canada. He specialised in investments in the communications hardware and software, enterprise applications software and data storage technology sectors and became one of the firm’s six partners.  

A source close to the firm said it had informed clients, investors and investee companies of the change and had clarified board arrangements. Castle will still be employed for an unspecified period by MTI to oversee the handover of investee companies in which he had a personal involvement. “MTI has a very hands-on approach and you can’t just walk away,” said the source.

The key issue for MTI will be how the changeover will affect its fundraising prospects. It closed its most recent MTI 4 fund at £104m in February 2001, easily surpassing an original target of £50m to £75m. The previous fund, MTI 3, had achieved an IRR of over 58 per cent at 31 December 2000.

Although the firm has not yet set a date for the launch of its next fund, the same source said it would probably be within the next six to eight months and added: “All the investors know Ernie as well as they know Paul. It’s not a large partnership, so I don’t think it will be a huge problem.” Commitments in MTI 4 came mainly from UK institutions and pension funds, while 17 per cent came from US fund of funds.

In September, MTI hired former Onyvax executive director David Holbrook as an investment manager to expand its life science activities ahead of the next fundraising. MTI has in the past mainly focused on IT and materials technology.