Open Ocean Capital, the early-stage venture capital firm led by investors who closed the USD1 billion sale of MySQL to Sun Microsystems (now Oracle) in 2008, has just closed its Fund Three with approximately USD60m (EUR40m) in capital in the first closing. The fund kicks off the first widespread outreach from the former MySQL team to founders and start-ups in Europe and beyond.
"With top level experience from product, community, and business development during the MySQL story, we are excited to offer start-up teams the funding and advice they need for embarking on a similar journey," says Patrik Backman (pictured), Open Ocean Managing Partner. "While we continue to focus primarily on European start-ups deploying community and open-source business models, we’re open to hearing from all disruptive companies that are interested in changing the world."
The launch of Fund Three comes at an exciting time for the start-up and open-source communities. In the US alone, 2010 saw USD23.7 billion of venture funding go into 2,792 deals, a 14% increase in funding and a 13% increase in deals from 2009. Open source outpaced that impressive growth, as private investment in American open-source software-related vendors last year increased 18% from 2009 to USD466 million, the third largest total ever.
Backman adds: "It hasn’t gone unnoticed by us that there’s a lot of buzz right now around this kind of renaissance for venture capital. On top of that, we think it will continue to be an especially strong period for companies deploying community and open source business models. Businesses of all stripes can benefit from user communities to scale more efficiently, develop products at lower costs and maximize growth."
Open Ocean is also looking to set itself apart from the traditional venture capital fund by offering the same kind of active guidance to start-ups that shepherded the development of MySQL, culminating in its sale to Sun. Financially, Open Ocean’s strategy is to start investments at approximately USD1 million — with additional performance-based rounds totalling up to USD8 million — usually translating to a 10-40% stake in portfolio companies.
