VWCM entered the venture capital business in 1997 when it realized its public securities investment process would be successful analyzing and selecting late stage/expansion capital private securities and would capture the valuation discrepancy between public and private valuations. The asset allocation decision was very effective, investing over $300 million in late stage/expansion capital private securities between 1997 and 2003, supporting 54 portfolio companies with a return multiple of 3.8x and an annualized ROI of 99.8%. After the internet bubble burst in 2000, VWCM realized the arbitrage between public and private late stage/expansion valuations had disappeared and sold its remaining venture portfolio by 2003, leaving late stage VC investing for 7 years.
After the mortgage crises had run its course in 2010, GVW funded several investments in Impact/SRI to determine if a non-concessionary ROI approach to impact investing could be realized. One of the investments made in that portfolio was a Clean Tech venture converting internal combustion engine pickup trucks and vans to a plug in hybrid configuration for fleet applications. The Company has successfully sold 225 of its first generation trucks and has a signed term sheet to finance the expansion of its next generation vehicle and international expansion. Through 6/30/2017 the investment has had a return of 9.4x and an IRR of 48.4%.
Van Wagoner Ventures predecessor, Van Wagoner Capital Management (VWCM) was founded in 1995 after a decade of small cap emerging growth experience including the highly successful Govett Small Companies Fund which won the prestigious Lipper Achievement award 3 times in a row in 1993, 1994 and 1995. VWCM has specialized in Public and Private/Late Stage Venture investing in US based emerging technology solutions for 20+ years. The Company's initial mission was to leverage the "Direct Research" model employed at prior firms to advise a family of 5 Mutual Funds, the "Van Wagoner Funds" (VWF) focusing on new technology verticals reaching $4 billion in AUM (sold 2009).
The due diligence done prior to our first transportation investment, our ongoing research and the significant experience in recognizing new disruptive technologies that can fundamentally change traditional vertical markets led us to sharpen our focus over the past five years on transportation infrastructure, developing the intellectual property and domain expertise to reach the following conclusions:
1. The commercial segment of the $1 trillion transportation vertical was being disrupted by “new economy” start-ups utilizing software technology to design and integrate standard components creating fundamentally new solutions for global transportation infrastructure markets.
2. The OEM’s and there Tier 1 partners were likely to continue to follow rather than lead allowing significant market presence to develop for the “new economy” leaders in each of these traditional verticals.
3. As identified several times before in other tech verticals, the arbitrage opportunity is clearly present between early public/late stage expansion valuations in these new economy verticals. Lack of competition for deal flow stems from VC’s lack of focus on this vertical, being deemed too painful given past experience, too capital intensive or not enough disruptive technology for today’s VC models.
To take advantage of this opportunity, Van Wagoner Ventures LLC is currently raising capital to fund leadership companies in this vertical. We intend to be the leading financier disrupting the $1 trillion global commercial vehicle transportation infrastructure. We have developed substantial domain expertise and intellectual property in the commercial space over the past 5 years, identified a backlog of leading technology investments and intend to dominate investing in leading solutions within our defined verticals.