Venture capital firm Cottonwood Technology Fund has completed its initial close of Cottonwood Technology Fund III. This first close puts it on track to reach its target final close of €75M to €100M with €25M currently in hand.
About Cottonwood Technology Fund
The firm was founded in 2010 with its origin in the USA and then in 2014, it opened an office in The Netherlands. Cottonwood makes seed and early-stage investments in companies developing disruptive hard science technologies.
Cottonwood Technology Fund is a venture capital and private equity company that is willing to invest in companies in the pre-revenue/pre-product stage. The VC firm invests in sectors including nanotechnology, robotics, and the automotive industry.
According to the VC firm, it invests primarily in the Southwestern USA and Northwestern Europe. The Cottonwood team screens around 1,500 technologies & companies per year, but invests only in 2 to 3 new disruptive companies per year (0.2% of all opportunities). In total it leads 8 – 10 investments per year (including Series B, C, D, E, F follow-on rounds).
Notably, the firm does not invest in software, platforms, artificial intelligence, or apps. It also refrains from investing in technology without a patent.
Besides, it also focuses on investing in patent-based high-tech and hardware startups sectors including robotics, photonics, optics, nanotech, sensor tech, telecom, automotive, cleantech, green energy, Medtech, chemicals, and advanced materials.
“The Cottonwood brand also continues to grow and be recognised in Northern Europe. Like many under-resourced regions around the world and in the United States, Northern Europe has many disruptive areas of innovation that have difficulty recruiting the capital they need to build a first prototype and attract the attention of first customers and next round investors. Cottonwood’s willingness to embrace this challenge from the earliest stages is a much needed resource to the Northern Europe technology commercialisation community,” says Alain le Loux, General Partner and leading the European Office in The Netherlands.
The VC firm’s current and prior investments include Skorpios Technologies, FibeRio (acquired by Clarcor), xF Technologies, Eurekite, Sarcos Robotics, BayoTech, Respira Therapeutics, Infinitum Electric, Trilumina, SoundEnergy, OPNT and Exagen (Nasdaq XGN).
Earlier this month, Cottonwood Technology Fund announced its investment in American company mPower Technology. It is the first investment warehoused for Cottonwood Technology Fund III. mPower Technology has developed DragonSCALES (SemiConductor Active Layer Embedded Solar) solar cell technology.
Prior to that, in September, Cottonwood’s portfolio company Exagen (investment in 2011) closed its Initial Public Offering. The current value of Exagen Inc is $305M (growth of 2,300% in 8.5 years).
Last year, the VC firm hired Forbes 30 under 30 honoree Marie Weijler to join its investment team. Starting with Fund III, Weijler contributed to the further expansion of the Cottonwood Technology Fund in Europe.
Image credit: ShutterStock