Mastercraft Ventures in Beloit has raised $6.2 million in funding and aims to begin deploying capital by the fourth quarter of this year.
That’s according to Managing Director Mason Cook, who discussed the path ahead for the fund in an interview Friday. It launched earlier this year with a $2.4 million investment from the state’s Badger Fund of Funds, which makes up about 40% of the $6.2 million total being announced today. The rest came from private investors.
“At the end of the day, Mastercraft Ventures, our main goal is closing the gap in funding in the state,” Cook said. “Wisconsin ranks toward the end of states — not just in the Midwest, but in the country — of available venture capital dollars.”
Cook previously led software business RealityBLU in Beloit.
He noted many startup companies end up seeking funds elsewhere and even leaving Wisconsin altogether, and he wants to help provide more seed capital for businesses coming up in the state. The firm will provide the first $500,000 or so that an entrepreneur needs to get off the ground, investing across a wide array of industries.
“Looking at Wisconsin and southern Wisconsin in particular where I am and a lot of my network is, there’s just a few industries that I think we punch above our weight class in, specifically advanced manufacturing, food processing, health care, distribution logistics,” he said. “Those are areas where we’re really excited, especially with things like AI and automation being great tailwinds for those specific industries.”
The firm is primarily focused on companies based in Wisconsin, and Cook says “there’s an opportunity to return great capital for our investors” by looking at innovation coming from within the state. But he referenced having “some latitude to look outside of state lines” as well.
Cook also praised the state’s willingness to back up-and-coming fund managers through the Badger Fund of Funds.
“I really think venture capital is an apprenticeship business, and Wisconsin in particular has perhaps a succession problem where older venture capitalists at the later end of their career haven’t necessarily been able to find a successor or put systems in place to do that,” he said, noting the Badger Fund of Funds “can actually fill a nice gap in Wisconsin.”
He added: “I saw that vision and really was attracted to that from the Badger Fund side.”
Mastercraft Ventures is the eighth venture capital fund supported by the Badger Fund of Funds. Ken Johnson, a partner in the state financing effort, says a major focus is addressing the state’s need for “first in investors” for new startups.
“Typically, a VC fund will continue to fundraise to their target fund size after holding a close like this, and the Badger Fund will invest an additional 40 cents for every 60 cents raised by Mastercraft,” Johnson said in a statement.
Mastercraft plans to register with the Wisconsin Economic Development Corp. to be certified as a qualified venture fund, the announcement notes. That would allow it to offer state tax credits to eligible investors when it backs startups based in the state that are recognized as qualified new business ventures.
Cook said he’s excited for the fund to “be a vehicle for folks to really invest in Wisconsin’s upside.”
See the release and an earlier story on the firm.
See another recent story on investment in Wisconsin.
