VCCI-backed Kensington Venture Fund III holds $150M initial close

CPE News

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CPE News (4.6.2023) – Kensington Capital Partners has held a $150 million initial close for Kensington Venture Fund III (KVFIII) towards an ultimate fund size of $290 million.

Kensington Venture Fund III, which is being launched under the Government of Canada’s Venture Capital Catalyst Initiative (VCCI), is backed by BDC, Kensington Private Equity Fund, TD Bank, and several individual investors and family offices.

In alignment with hybrid strategy for its previous funds, Kensington Venture Fund III will serve as both a fund-of-funds investing in venture capital (VC) funds and a direct investor into promising technology companies.

Kensington Venture Fund III portfolio will allocate 75% of invested capital into funds, with the remaining 25% targeted at direct investments into companies.

Kensington Venture Fund III is Kensington Capital Partners’s third Government of Canada backed fund of funds.

VCCI backed Kensington Venture Fund II, a 2018-vintage fund, final closed at $150 million in October 2019.

Venture Capital Action Plan (VCAP) backed Kensington Venture Fund, a 2014-vintage fund, final closed at $306 million in March 2016.

photo credit: Kensington Capital Partners

News Release

Kensington Capital Partners Announces $150 Million First Close of Kensington Venture Fund III

TORONTO – April 6, 2023 /Private Capital Newswire (pcNewswire)/ – Kensington Capital Partners today announced that it has raised more than $150 million in the first close of Kensington Venture Fund III (KVFIII) towards an ultimate fund size of $290 million. In alignment with the firm’s hybrid strategy for its previous Funds, KVFIII will serve as both a fund-of-funds investing in venture capital (VC) funds and a direct investor into promising technology companies. The fund, which is being launched under the Government of Canada’s Venture Capital Catalyst Initiative (VCCI), is backed by BDC, Kensington Private Equity Fund, TD Bank, and several individual investors and family offices.

“We have established a proven model for successful performance in venture investing, and our new fund builds on that successful track record,” said Rick Nathan, Senior Managing Director, Kensington Capital. “This is the third Venture Fund we are launching in partnership with the Government of Canada. Kensington’s renewed selection as a fund manager for the VCCI program is a strong endorsement of our team, our investment process, and strategy.”

“It’s a priority for BDC Capital to invest in Canada’s most innovative companies so they can continue to create jobs and support sustainable economic growth across the country,” says Jérôme Nycz, Executive Vice President, BDC Capital. “With this renewed commitment from the VCCI, Kensington is now in a strong position to provide important capital to fund managers and entrepreneurs in a time when it’s most needed, all while advancing diversity, equity and inclusion in the Canadian VC industry.”

As one of Canada’s leading alternative investment firms focused on private markets, Kensington has a 27-year track record of successful growth and a strong commitment to ESG principles across the firm and its investment portfolios.

Kensington is now actively pursuing investment opportunities for KVFIII in new venture funds and in promising emerging companies. The KVFIII portfolio will allocate 75% of invested capital into funds, with the remaining 25% targeted at direct investments into companies. The fund as a whole will have a primary focus on the Canadian market.

About Kensington Venture Fund III
Kensington Venture Fund III will invest through a hybrid strategy that includes direct investments in emerging technology companies as well as investments into venture capital funds. The Fund invests across all stages from early-stage Seed and Series A through later stage technology growth. This approach provides Kensington with a broadly diversified portfolio covering all key subsectors, including artificial intelligence, industrial automation and robotics, cybersecurity, life science/healthcare, energy and sustainability technologies, and tech-enabled services such as e-commerce, telemedicine, and online education. Kensington invests primarily in funds and companies across Canada and the United States, acting as lead investors or as supporting members of a syndicate.

About Kensington Capital Partners
Founded in 1996, Kensington Capital Partners Limited is an employee-owned, high performing alternative investment firm with offices in Toronto, Vancouver, and Calgary. Kensington’s mission is to build great businesses, and in doing so, create top-performing investment solutions for its investors. Kensington has assets under management of $2.6 billion, managed across several active funds. www.kcpl.ca

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Kensington Capital Partners Announces $150 Million First Close of Kensington Venture Fund III