Matthews lands $100MM for new fund

Dateline: Montreal

Get out from behind your desk. That’s a good credo to live by in the entrepreneurial world. And you get to hear what’s going on long before it makes it way into the mainstream.

Yesterday’s example of that was the 7th annual Venture Capital Forum, featuring Canadian, American and European players drawn from across the VC ecosystem. The French Chamber of Commerce in Canada played host.

The conference featured an interesting discussion about the different moves around the world to regulate venture capital and private equity funds. Pierre de Fouquest, Chairman of Paris-based Iris Capital, outlined the reality that throughout Europe, VC funds of a certain size will now need to be regulated if they want to raise capital outside of their home country. Chinese or Indian VC funds can do deals in Germany without oversight, but not the Dutch. Ironically, depending upon the home country, certain domestic financial regulators have refused to review the very materials that the European Parliament is going to require VC funds to prepare and submit. How’s that for a waste of time and money?

The big news of the show came from Sir Terry Matthews, Chairman of Ottawa’s Wesley Clover, who announced during a lunch speech that he’d raised $100 million for his new fund Roman Road, $20 million of which he had provided personally. The ultimate fund size wasn’t clear, but it appeared that $200 million might be the target. It would appear that he’s named the fund after one of his courses at the Celtic Manor golf resort in Wales.

His new strategy is different than many traditional VC funds. Sir Terry has arrangements with several Canadian universities to hire a host of Engineering grads at $25,000 per. He’s not looking for those with the highest marks, but the ones that want to work very hard (day and night), bring chemistry to the team, and have the internal fire of an entrepreneur. Unlike what some early stage investors might try, Sir Terry isn’t interested in funding the business ideas of the new grads: “they’re awful” 99% of the time, he said. Instead, Sir Terry will go to the ultimate customer, such as a comunications equipment maker, and see what they need his team to build.

“Demand driven” investment is what he’s calling it. Based upon his track record to date, you can be confident that this is going to work.

MRM