TENNESSEED FUND CLOSES ON $12 MLN. RAISE, SEEKS SBIC STATUS

The TennesSeed Fund, a venture fund organized by a public-private group, has closed on a $12 million raise of capital. When fundraising is complete, the capital will enable the fund to invest $40 million to $50 million in early-stage technology companies in Tennessee.

Among the institutional investors in the fund are UT-Battelle, SunTrust Bank, Union Planters Bank, and the University of Tennessee. The fund's investment committee consists of Don Welty, TennesSeed Fund manager; David Coffey of Oak Ridge; Fred Decosimo of Joseph Decosimo and Co. in Chattanooga; Lee Martin of Clarity Resources in Knoxville; John Maxwell of Global Technology Investments in New York; Charles Peccolo, treasurer of U.T.; Gary Peterson of Walden Resource Group of Salt Lake City, Utah; Richard Plumley of Knoxville; and Tom Rogers, president and chief executive of Tech 2020.

The TennesSeed Fund will invest $500,000-$3 million increments in companies in the communications, materials processing, information/internet technology, and biotech industries. The fund is seeking to become a Small Business Investment Company (SBIC), which will enable it to receive low interest rate financing in an amount two or three times its equity base.

The fund is a joint venture of Technology 2020 and the Tennessee Technology Development Corporation.

The TennesSeed Fund will begin accepting applications for investment on June 1, 2001.