Newark Venture Partners Raises $85 Million And Adds A New Managing Partner

Located just 13 miles west of Manhattan, Newark, New Jersey has the potential to be a successful startup hub. That’s the belief of Newark Venture Partners. The city of nearly 300,000 is home to huge corporations like Prudential and Panasonic and it has its own bustling airport. It’s also where Newark Venture Partner cofounder Don Katz launched his audio book startup Audible in 1995 before scaling and selling to Amazon 13 years later. But the city also has had trouble with housing and infrastructure and could use some help. Katz, along with Dan Borok and Tom Wisniewski, envisioned a fund that would incubate entrepreneurs and invest in companies while also giving back to the broader ecosystem. Together, the three launched their VC firm and raised its debut $44 million fund in 2017. 

Newark Venture Partners Fund I amassed a portfolio of early-stage stakes that produced nine exits, including agtech AeroFarms which plans to go public via a SPAC valued at $1.2 billion. The fund has been able to ride this success to raise nearly double for Fund II, $85 million, with the help of its new managing partner Vaughn Crowe, as originally reported by Midas Touch newsletter. Crowe, originally from Newark, has been involved with the firm from the start, beginning as an LP in the first fund through his prior role as a managing director at Wesray Social Investments, Ray Chambers’s family office. “On a personal note it was absolutely the right move to transition from the family office to join as a partner, I couldn't be more thrilled,” Crowe tells Forbes. “ This unbridled commitment that we each have to outsized returns and the commitment to our community rings true through the entire team.”

Newark Venture Partners invests in B2B software companies through leading or co-leading seed rounds with checks up to $2 million. The latest fund also has enough reserves so the firm can make follow-on investments at the Series A stage, managing partner Borok says. The firm is sector agnostic but is particularly interested in areas like healthtech, supply chain and audio/voice, industries Borok thinks play to Newark’s historical strengths. Companies don’t have to be based in Newark, but the firm hopes they consider contributing to the ecosystem. “We do have a real commitment to the community in Newark and we’ve broadened that commitment,” Borok says. “We have always believed that getting companies to build in Newark will add to the ecosystem.”

The firm has had strong ties to Newark-based corporations from the beginning as many of them including Prudential, RWJBarnabus Health and Audible have been anchor LPs for both VC funds. NVP looks to its partners to provide more than just capital though as portfolio companies can turn to them for industry-specific advice or use them as platforms to run beta trials or gain potential customers. Crowe gave an example of one of their portfolio companies in the healthcare space, Wellsheet, which uses machine learning to help doctors predict patient outcomes, having a successful partnership with RWJBarnabas Health, one of the firm’s LPs. 

While NVP looks to be a for-profit entity that produces real returns, the main focus is really on building up the Newark community. The firm is proud that its investments have helped bring hundreds of jobs to the mid-size city and has helped provide internships to students from local colleges like Rutgers and the New Jersey Institute of Technology. The success of the firm’s latest fundraise will allow it to expand this giving. “In Fund II something we will do more of over the next year is give a portion of our carried interest to the Boys and Girls Clubs, and to Rutgers,” Borok says. “We have also broadened our internship programs.” Crowe adds that the firm will use this new capital to continue its mission of giving back to the city while also building a brand the town can be proud of.