Exclusive: Tampa’s Ballast Point Ventures closes fourth fund $35 million over target

By:  Lauren Coffey

       Tampa Bay Business Journal

 

Tampa-based investment firm Ballast Point Ventures has closed its latest fund with $190 million in commitments.

The firm’s initial goal for its fourth fund was $165 million, which it closed in January 2021. But interest from investors, both old and new alike, continued to climb.

Institutional investors, family offices and about 50 entrepreneurs participated in the fourth fund, with roughly 100 total investors.

An oversubscribed fund is not particularly unique for Ballast Point, which oversubscribed nearly $25 million in its third fund in 2015. Partner Drew Graham said anything below $200 million is “key” to sticking to the company’s strategy. That strategy means investing in three to four companies per year, with investments that run between $5 million to $15 million.

It’s a strategy that helps Ballast Point stand out, according to partner Paul Johan.

“The companies that aren’t ready for a $15 million to $20 million round can be in a position for a $5 million check, and we don’t have to pressure them to take more capital,” Johan said. “A lot in the region we don’t see competing in that size, the $5 million to $8 million [rounds]. It’s where we’ve been the last five years, and it’s positioned us well.”

Ballast Point was founded in 2001 and has partnered with over 50 companies across its four funds. It invests in companies across the Southeast. The firm primarily focuses on technology and health care, which have seen upticks during the Covid-19 pandemic.

“We have companies that were largely impacted [by Covid-19], mainly on the health care side,” said Matt Rice, a partner at Ballast Point who leads the health care practice. “The good thing about having a diversified portfolio, a big chunk is software and technology — which benefitted during the pandemic. … Like a lot of entrepreneurs, we also had to adapt in order to get to a successful outcome.”

Rice added remote patient care is a trend Ballast Point is following. Partner Robert Faber, who focuses on technology, said he has some trends to focus on with the new fund.

“We’re big believers in data to make decisions; we spend a lot of time in cybersecurity,” Faber said. “Any business-to-business tool which simplifies and takes the frustration out of the process.”

Ballast Point has already begun deploying capital from its fourth fund, investing in four Florida companies over the last year:

• March: Led an $8 million Series A in Bradenton-based Pacemate
• May: Participated in a recapitalization for Lutz-based Suncoast Skin Solutions
• September: Led a $5 million Series B in Santa Rosa Beach-based Key Data
• December: Invested in a $37 million Series B for Tampa-based Symphonic Distribution

“All four being in Florida is huge for us,” Partner Sean Barkman said. “And hopefully, we’ll end up with a majority of companies in Florida in this next fund.”