Vistara Capital Partners holds US $40M initial close for second debt fund

Vistara Capital Partners Ltd. has held a first close for its second fund, Vistara Technology Growth Fund III LP, with over US $40 million in committed capital primarily from returning LP investors.

Vistara Capital Partners is targetting to raise up to US $100 million for the second fund.

Vistara Technology Growth Fund III LP will invest between US $5M and US $15M per company in senior or subordinated debt, leveraging well-established relationships with bank lenders and equity funds across Canada and the US.

Vistara Capital Partners launched its initial debt fund, Vistara Capital Partners Fund I LP, in 2015 and held final close at CDN $100 million target in July 2015.

photo credit: Vistara Capital Partners

News Release

Vistara Capital Partners Launches US$100 Million Debt Fund to Fuel Mid to Later Stage Technology Companies Across North America

VANCOUVER, Oct. 16, 2018 /PRNewswire-PRWeb/ — Vistara Capital Partners announced today the launch and first close of its third fund, the Vistara Technology Growth Fund III LP, with a goal to raise US$100 million. “Vistara” (Sanskrit for “expansion”) provides capital in the form of highly flexible debt financing for tech companies — an increasingly popular financing method to fuel growth without giving up further control, resetting valuation, or diluting founders’ and existing shareholders’ equity stakes.

“There is a rapidly increasing number of mid to later stage tech companies looking for additional forms of capital to fuel growth beyond traditional sources,” said Randy Garg, Vistara Founder and Managing Partner. “Since inception, Vistara has worked with both founder-owned and venture-backed tech companies across North America to help them achieve their growth objectives. With this fund, we are aiming to further grow our capabilities to support the next wave of technology industry leaders.”

Vistara Technology Growth Fund III LP will invest between US$5M and US$15M per company in senior or subordinated debt, leveraging well-established relationships with bank lenders and equity funds across Canada and the US. Additional co-investment capacity comes through Vistara’s strong network of LPs which include a number of prominent family offices, foundations, and over two dozen current or former technology company executives.

PORTFOLIO COMPANY EXTENDS RUNWAY WITH VISTARA GROWTH FINANCING; RAISES OVER US$345M IN SUBSEQUENT FINANCINGS

In 2016, Vistara provided peer-to-peer carsharing company, Getaround, with a US$7M interest-only term loan which enabled the company to meet important milestones ahead of its $45M Series C financing round. Vistara’s initial note was refinanced as part of Getaround’s most recent US$300M Series D round led by SoftBank, and Vistara continues to be engaged as a partner through Getaround’s exciting growth.

“When Getaround was looking to extend our runway and execute several key initiatives prior to our next equity raise, Vistara stepped up,” said Adam Kosmicki, CFO of Getaround. “Vistara put together a financing solution tailored to our needs and moved quickly to close. This was vital to a company like ours, working in a fast-moving sector. We were able to get back to running the business and prioritizing the factors most important to Getaround’s long-term growth.”

A TRACK RECORD OF ZERO LOAN LOSSES AND SUCCESSFUL EXITS

Vistara Technology Growth Fund III LP springboards off the success of past funds which have seen a number of successful exits, zero loan losses, and strong consistent returns for investors. The core investment team at Vistara have dedicated their careers to financing technology companies, including a prior family office fund managed by Garg specializing in the same investment strategy.

“Private debt is really a win-win for both companies and investors. Companies can gain access to meaningful capital without having to reset valuation or reduce ownership. For investors, this asset class provides lower volatility, minimal market correlation, and a recurring income stream with capital gains upside—all realizable within a shorter period than typical VC investments,” said Noah Shipman, who has become a Vistara partner with Fund III. “Our first two technology-focused funds filled quickly, and both have experienced success delivering net double-digit returns with further upside to come. We are very pleased that Fund III is already at over US$40M, closed primarily from investors following on from Funds I and II.”

EXPANSION PLANS FOR ONTARIO

To get closer to Ontario’s burgeoning tech industry, Vistara will also be opening a new Toronto office. “We would love to place at least half of the new US$100M fund in Canada to help mid to later stage Canadian tech companies further scale and become true champions as opposed to stalling out or selling too early,” said Garg. “The Canadian tech scene is vibrant, its future leaders are emerging, and we have the right investment structures and proven expertise to help push the right companies forward.”

ABOUT VISTARA CAPITAL PARTNERS

Headquartered in Vancouver BC, Vistara Capital Partners provides highly flexible and tailored debt financing for technology companies across North America. Founded, managed, and funded by seasoned technology finance and operating executives, “Vistara” (Sanskrit for “expansion”) is focused on enabling the growth and expansion of its portfolio companies. Additional information is available at https://www.vistaracapital.com.

SOURCE Vistara Capital

Ted Liu

Ted Liu, M.Sc. (Mining), MBA (Finance), is the Editor of Private Capital Journal, CanadaMetals.ca, TechWire.ca, and the former Editor of Canadian Private Equity. Ted has been passionately tracking Canadian private capital industry since 1992, having most recently served as Research Director for The Canadian Venture Capital and Private Equity Association (CVCA).

Ted is the architect of CVCA infobase, and is the architect of CPE Media's Financings.ca, Canada's most sophisticated and advanced all private capital and public market financing database.