Mission Operators Group (MissionOG), the Center City venture firm that has backed four Philadelphia startups, has raised $9 million for its fund, according to SEC filings (here and here). The firm is actively raising right now, partner George Krautzel confirmed.
The filing says that the firm is raising up to $49 million, though Krautzel said he couldn’t elaborate on the details of the raise because of SEC rules.
Launched roughly 18 months ago, MissionOG has made five investments (four local and one in the United Kingdom) in financial tech, software and services and content and media startups.
That small number, instead of say, 15 or 20 investments, is by design: MissionOG prioritizes an “operator’s approach,” as Krautzel puts it, which means that MissionOG’s partners, all of whom are former entrepreneurs, work with portfolio companies on an ongoing basis. Some partners have even taken roles within portfolio companies — Krautzel, 41, of Unionville, Pa., is the COO of portfolio company Cloudamize, and partner Kevin O’Nell is the CEO of portfolio company PeopleLinx.
It’s an approach that’s different from that of other VCs, Krautzel said, who might instead have an entrepreneur in residence to work with startups. Still, Krautzel said it’s been a recent trend to add “operational talent” to venture firms.
Krautzel himself founded social media company ITtoolbox, which he sold for $59 million to Corporate Executive Board in 2007. His three other partners at MissionOG — O’Nell, Andy Newcomb and Drew Kese — all worked at prepaid card startup Ecount, which they sold to Citi in 2007. This “been there, done that” expertise is crucial to MissionOG’s goal of working closely with portfolio companies, Krautzel said.
MissionOG only invests in companies that have made it to the commercialization and revenue stage. For a seed investment, they’ll invest $250,000 to $500,000, and for a Series A, they’ll invest “a couple million” dollars, Krautzel said.
Though the bulk of their deals have been local, MissionOG is also looking outside of the market, Krautzel said. But starting in Philadelphia was an important step.
“It’s important to win locally in order to win in other places,” he said.
They’ve also been working with private equity firms and later-stage venture firms to source deals, Krautzel said. Those firms will come to MissionOG with a deal that’s too early for them, he said, and look at MissionOG as a way to get those companies to grow faster, so they can get to a point where they can make an investment.
The firm made a big-name addition this summer with Gene Lockhart, the former CEO of Mastercard. The MissionOG advisory board also has local names like Pet360 CEO Brock Weatherup and Relay CEO Matt Gillin.
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