Private Equity News & Analysis

SJF closes Fund III above target

The firm has held a final close on $90m, more than triple the size of its previous fund that collected $28m in 2007.

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US growth capital investor SJF Ventures has closed its third fund on $90 million, north of its $75 million target. 

SJF launched Fund III in February 2012 with a $100 million hard-cap. The fund is licensed by the US Small Business Administration, which allows SJF to receive commitments from banks that otherwise are prohibited from investing in equity funds as a result of Dodd-Frank legislation and the Volcker Rule.

Citi Community Capital, the community development lending and investing group of Citi, is the lead investor in the fund, having committed $15 million. Other limited partners in Fund III include Deutsche Bank, Calvert Equity Portfolio, Trillium Asset Management and a number of family and individual investors.

“We have a lot of new investors, maybe 50 percent of the capital,” SJF Ventures co-founder and managing director David Kirkpatrick told Private Equity International. “Our previous fund was $28 million, so we’ve had to expand our LP network. We had several deals in Fund II where we could easily have put two or even three times as much capital in…Fund II was really too small for the opportunities we were seeing.”

SJF has invested in three businesses to date from Fund III, backing food technology and processing company Aseptia, biotechnology lab equipment business BioSurplus and ServiceChannel, which provides software-as-a-service to retail facilities managers. The three investments together represent less than 10 percent of the capital raised for Fund III.

SJF makes growth capital investments in businesses that deliver “strong social and environmental impacts”, according to a statement. The firm targets companies generating up to $20 million of revenue, committing up to $7 million per transaction. 

In March, SJF promoted former principal Cody Nystrom from principal to managing director. The firm now has three managing directors in its North Carolina office, one in New York and one in San Francisco. SJF has plans to add one investment professional at the associate and analyst level in each of its three offices.

SJF Ventures’ areas of focus include resource efficiency and infrastructure, recycling and reuse, sustainable agriculture and food safety; and technology-enhanced services.