Yaletown Partners has gone national by planting its flag in Montréal and introducing new team members, including the head of Open Text’s venture program.
The Vancouver investor, which is raising a $135 million growth equity fund, on its website announced the opening of a Montréal office and recruitment of three senior investment pros.
The hires include tech executive and investor David Harris Kolada, who joins Yaletown as a venture partner, operating from Toronto.
Harris Kolada’s VC career stretches back almost two decades. He most recently served as OpenText’s vice president, venture capital, overseeing all aspects of the software company’s $100 million strategy, including fund commitments. OpenText has backed several Canadian and U.S. funds, including as the founding investor in OpenText Enterprise Application Fund.
Harris Kolada joined Open Text in 2015 from Sustainable Development Technology Canada, where he was responsible for strategic partnerships. Between 1998 and 2004, he was a partner at Jefferson Partners.
Yaletown also recruited Shyam Gupta, founder and CEO of Somel Investments, as a partner. Sophie Gupta, Shyam’s daughter and Somel’s managing director, was brought on as a principal.
Somel launched two years ago as a boutique Montréal private equity firm following the sale of a family-owned telecom business, SDP Telecom, to Molex. It backs companies focused on the internet-of-things and industries that leverage IoT applications. The current portfolio includes networking solutions provider Kaloom, which closed a US$10.7 million Series A round in March.
Somel’s father-and-daughter team has been charged with running Yaletown’s Montréal office. They will also help extend the firm’s reach into Québec machine learning, artificial intelligence, IoT, big data and other innovative sectors that are central to its investment thesis.
Pan-Canadian strategy
The combined announcements signify Yaletown’s expansion beyond a primary emphasis on deal-making in Western Canada. It now has a pan-Canadian strategy based on an operational presence in four cities, including the Vancouver headquarters and Calgary office.
The move is in line with the firm’s recent decision to intensify its focus on emerging-growth companies located across Canada. Yaletown Emerging Growth Fund, unveiled last year, is earmarked for financings of domestic mid-stage industrial and enterprise tech companies.
Drawing on market experience and research, Yaletown has argued that many such revenue-positive companies face a capital gap, forcing them to bootstrap their growth. In February, a TMX-funded working group supported this finding, estimating the late-stage gap at some $4 billion.
Yaletown’s fund offering is being marketed to new and repeat limited partners, including institutional and high-net-worth investors.
Fundraising activity gained impetus last November with the sale of portfolio company Bit Stew Systems to GE Digital for a reported US$153 million. Bit Stew, an industrial internet software platform, first raised funding in a Yaletown-led Series A round in 2013. Yaletown reported earning a return of roughly 7x on that initial investment.
Another portfolio company, software lifecycle integration provider Tasktop, last month raised US$11.3 million in follow-on financing.
Yaletown’s new personnel bring the total staff complement to 11. The firm is led by Managing Partner Salil Munjal and Partners Eric Bukovinsky, Brad Johns, Hans Knapp and Mike Satterfield.
(This story has been updated to correct a fact about Yaletown’s fundraising process.)
Photos of David Harris Kolada (top) and Shyam and Sophie Gupta courtesy of Yaletown Partners