Yaletown Venture Partners Completes $65M Initial Closing

By Sari Krieger

Clean technology venture capital firm Yaletown Venture Partners announced a $65 million initial closing on Yaletown Ventures II Limited Partnership.

The Vancouver-based firm's second fund has a target of $100 million and will remain open to new investors for up to 12 months. The capital for Yaletown's second fund comes from institutional and private investors in Canada and the U.S., including major pension funds, fund of funds, financial institutions, and professionally managed family offices, the firm said.

Yaletown invests in early-stage clean technology and information technology companies in western Canada and the Pacific Northwest.

Steve Hnatiuk, Yaletown co-founder and general partner, said in an interview with Clean Technology Insight that despite the tough economic conditions, now is still a good time to invest in innovative companies.

"Yaletown is no stranger to challenging market conditions, but it's our belief that entrepreneurs do not stop innovating if there are good opportunities to be pursued despite challenging economic conditions," he said.

While the firm hasn't yet identified in which companies it will invest this time, Hnatiuk said Yaletown will continue to work with similar companies as it did in its debut $42 million fund raised in 2003 that is no longer adding portfolio companies.

None of the 10 companies Yaletown has backed have yet achieved exits, but Hnatiuk said "exits will be pursued when we and our management teams believe the conditions are present to optimize our returns."

The company helped to start NxtGen Emission Controls Inc., a clean diesel technology company, which is now shipping product.

"NxtGen is a very good example of the type of investing we do in transportation systems, which is part of energy because it's tied to emissions," Hnatiuk said.

The firm also invested in thin-film solar component manufacturer Redlen Technologies Inc., energy-modeling software company Thetus Corp., solar grade silicon company 6N Silicon Inc. and others.