Vistara Capital Partners has closed the first round of its newest fund to the tune of US$40 million.
The Vancouver-based growth fund aims to raise US$100 million by year’s end for investments geared towards more mature, business-to-business software companies as opposed to tech startups.
“Our capital is really for growth and expansion, it’s not as much for experimentation,” said Vistara managing partner Randy Garg.
“It’s companies that are at a stage where they’ve figured out their product/market fit. It’s less about the technology risk, their management teams are more fully formed, they’re not reliant on maybe one or two big customers.”
The fund’s investments, which typically range from US$10 million to US$15 million, will take the form of debt financing rather than equity financing.
It’s the third fund for Vistara, which Garg co-founded in 2015 with former Peer 1 Hosting CEO Fabio Banducci.
The latest fund was closed primarily from investors involved with the previous two.
Vistara’s Canadian portfolio includes Vancouver-based ecommerce platform Mobify and Toronto fintech Zafin.
“We’d love to put more money to work across Canada. We’d certainly love to put more money to work here in B.C.,” Garg said.
The growth fund has the potential to expand investments in Canada, putting as much as half the new fund in Canadian companies.
Garg said Vistara is focused on raising the remainder of the US$100 million by the end of 2018, after which the team will open a new office in Toronto in early 2019.