Austin Ventures, the VC and private equity firm, has launched its eighth mini-rollup fund in the last five years, and this is an intriguing one: it is putting $50 million into a vehicle led by former CEO of Razorfish, Jeff Dachis, to build an Austin-based corporate social networking software and services company. Dachis was one of the original pioneers of the so-called Silicon Alley in New York City, as the co-founder of the much-hyped web design firm in 1995. Razorfish now part of aQuantive, was sold to Microsoft (NSDQ: MSFT) for $6 billion in May 2007. Dachis moved to Austin three years ago.
As the firm describes it, he will focus on "creating an industry leading strategic consulting practice and an enterprise class Social Software-as-a-Service (SaaS) suite." It would be compeiting against the likes of LinkedIn, Generate (which just got bought by Dow Jones), VisualPath, and others.
AV has followed an interesting strategy and twist on EIRs, branding it as its CEO-in-Residence program: it been working with seven entrepreneurs in the last five years or so, backing them with sums of $50 million or more, allowing them to explore rollups in different media/tech and Internet vertical areas. Among them, former Bankrate (NSDQ: RATE) CEO Elizabeth DeMarse, whose vehicle now owns CreditCards.com (which attempted for an IPO last year but pulled back, citing "market conditions"); Brian Sharples (former CEO of Intelliquest who bought HomeAway Vacation Rentals with AV); Sherman Atkinson, the former COO of Intermix Media (parent of MySpace before it got sold to News Corp. (NYSE: NWS), who is yet to buy anything; and Jim Casella, former COO of IDG and CEO of Reed Business Information-US, who is looking at opportunities in B2B media (will he make a go at his former company RBI-US, now that it is being sold off piecemeal?).
Austin Ventures is currently raising two new investment funds that could total $900 million and are expected to close by year's end, reports Austin American Stateman.
By Rafat Ali