Dawn Capital closes second fund on £63m

Ellie Pullen
10 July 2013

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London-based VC firm Dawn Capital has held the final close of its Dawn Capital II Venture Capital Fund after raising £63m.

The early-stage, technology-focused fund is Dawn's first as a private fund manager, rather than an enterprise capital fund (ECF) manager. The firm was previously awarded an ECF mandate by Capital for Enterprise as a first-time fund manager.

The ECF programme is a government initiative designed to help funds accrue their targets. For every £1 raised by the ECF-mandated fund manager, Capital for Enterprise will provide £2 in debt to the ECF vehicle. According to Dawn partner Norman Fiore, the scheme makes fundraising far easier and means that a firm can close a fund much quicker than usual. The returns to investors are also more significant.

The GP's new fund launched in January 2012, according to Fiore, and has a lifespan of 10 years. The firm did not use a placement agent for the fund.

Dawn Capital II's predecessor, the Dawn Enterprise Capital Fund, raised £30m - only £10m of which was committed as equity by LPs, with the rest provided by the government initiative.

Investors
Dawn Capital II received commitments from a total of 40 LPs. Alongside private and institutional investors, the fund received contributions from a number of institutions. The European Investment Fund contributed to the vehicle via its UK Future Technologies Fund. State-owned investment scheme Capital for Enterprise also committed to Dawn Capital II, via its new £25m VC Catalyst Fund.

Investments
Dawn Capital II will be exclusively focused on investing in the early-stage period of European technology companies. The firm will act as a series-A backer for the technology sector, predominantly in cloud computing – including software- and platform-as-a-service – as well as consumer internet and financial technology services.

Dawn is planning to syndicate with other venture capital firms for the majority of the fund's transactions, due to there being "a lot less money in the market", according to Fiore.

The fund will typically provide an equity ticket of £5m per transaction, although this amount may fluctuate slightly from deal to deal.

People
Adrian Beecroft is the chairman of Dawn. Josh Bell, Norman Fiore and Haakon Overli are partners at the firm and will manage the fund.