Advances in biology, biochemistry, sensors and automation have the potential to reshape the ways manufacturing in America is done, and a relatively new firm called Anzu Partners has just raised $190 million to invest in companies turning these scientific achievements into new products and services.
Far from Silicon Valley, Anzu is investing in technology companies coming from places as disparate as Durham, Omaha and Santa Fe, in addition to the traditional technology hub of Boston and its surrounding area.
"We started in early 2016 with a focus on venture capital and early-stage private equity," says firm managing partner Whitney Haring-Smith. "The majority of the transactions that we do are minority, but there are a subset that are control."
One of those acquisitions, for the optical electronics equipment manufacturer Axsun Technologies, yielded one of the firm's early exits when the Massachusetts-based company was sold to Excelitas in a roughly $80 million transaction. The firm saw at least one other exit last year when Siemens bought its portfolio company MultiMechanics in November.
Co-founded and managed by former Boston Consulting Group leadership David Seldin and David Michael, the leadership team has expanded to include another BCG, alum, John Ho, who was just named partner with the close of the fund.
Anzu Partners writes checks in the $3 million to $8 million range and follows that capital with commitments of up to $15 million, according to Haring-Smith.
"We focus today on investing in the technologies that enable tomorrow’s industries," Haring-Smith said of the firm's thesis. "We don’t know whether this biologic drug or that biologic drug will succeed, but we know that all biologic drugs will need certain things."
Examples include the company's investment in the Santa Fe-based NTX Bio, which was made not because the startup manufactures particular biologics for the pharmaceutical industry, but because it makes technology which can produce lower-cost, higher-purity and higher-stability biologics. "It doesn't make vaccines, but makes vaccine manufacturing more cheap and efficient," says Haring-Smith.
The firm has already made six investments from its new fund since it first began fundraising efforts last April.
Portfolio companies include the Durham-based BioSkryb, which makes technologies to improve gene sequencing; Boston Microfluidics, which develops blood collection devices; GelSight, which makes 3D imaging systems to improve quality control in manufacturing; immunoSCAPE, which profiles immune systems to provide better data on potentially applicable therapeutics for patients; Sofregen, which makes tissue support and regeneration products based on a novel process for manufacturing silk proteins; and Solchroma Technologies, which uses a unique manufacturing process to make digital displays.
Anzu operates from offices in Tampa, San Diego, Washington and Boston, and Haring-Smith believes that the geographic diversity gives the company a leg up on deals.
With the new fund, the firm expects to expand its geographic footprint to other under-capitalized regions around the U.S.