After the extraordinary explosion of capital flowing into the venture industry in the late 1990s and beyond, the managing partners of the firm decided, contrary to the industry trends, that bigger was not better. We concluded that great returns and rewarding relationships with promising young companies were not likely to be realized with a sizeable institutional venture fund, and we stopped raising such funds. (To read the letter we wrote to our institutional investors explaining our departure from the world of institutional venture capital funds, click here). In effect, we returned to our roots: finding entrepreneurs who have bootstrapped themselves into the post-startup stage of early revenue generation, for whom experienced equity partners, along with half a million to a few million dollars of equity capital, would be attractive. We now make such investments on a very selective basis, using primarily our own funds. We welcome inquiries from entrepreneurs who believe capital should be used efficiently and who think we might be good partners to help them achieve their vision.

While examining the world of opportunities to invest in small growing companies, we also recognized a neglected opportunity to make long-term investments in publicly traded companies with limited trading and small market capitalizations. We characterize these situations as "publicly traded venture opportunities." Some of us have organized Kinderhook Partners, LP, a fund that is actively pursuing opportunities to invest in promising growing micro-cap public companies. We either buy blocks of stock from existing shareholders, shares on the open market, or shares directly from a company in order to provide capital.