New North Ventures Fund II

A Partnership Between the Office of Strategic Capital
(OSC) & the Small Business Administration (SBA)

Fund II Summary

New North Ventures Fund II is an early-stage venture fund focusing on critical technologies such as AI/ML decision-making, cybersecurity, and combating misinformation. The fund aims to advance innovation in the national interest by investing in companies with global reach based in the USA and allied countries. It is structured to invest in Pre-Seed through Series A companies, targeting a 10%-15% equity stake with check sizes ranging $1M - 3M. The fund has a reserve capital for follow-on investments and aims for an exit timeline of 5-8 years. The team behind the fund boasts a unique combination of national security and tech partners, enabling them to source and scale dual-use companies effectively.

Reasons to Invest in New North Ventures Fund II

  • Focus on Critical Technologies: The fund targets companies working on essential technologies, such as AI/ML decision-making and cybersecurity, that address pressing issues in today's digital landscape.

  • Strong Track Record: Fund I's history, which includes showcasing a 1.1x MOIC and partners realizing a 3x+ MOIC previously with 1,1x DPI, indicates potential for successful returns.

  • National Interest Alignment: The fund emphasizes advancing innovation in the national interest, aligning with the economic and security priorities of the US and its allies.

SBIC Feature

New North Ventures has a green light letter from the SBA for NNV Fund II, supported by the Office of Strategic Capital under the SBICCT program with an accrual debenture feature. This will enable us to offer features that can significantly enhance investor returns and create a unique government collaboration channel.

We have been fast-tracked for the first closing by the end of September, offering a timely opportunity to participate in the fund with the potential for higher returns.

KEY PROGRAM BENEFITS:

Capital Leverage: Every $1 of private capital that NNV raises is matched with $1.25 of non-equity capital

Government Connection: Problem set insight, threat assessments, clearance assistance, unique research agreements, sensitive unclassified information, and special due diligence

NNV FUND II EXAMPLE (4x GROSS MOIC CASE):

$80M Fund With SBIC

$35M Private Capital

$45M SBA Capital + $11M SBA Interest

$268M proceeds is $212M after SBA payback

6.0x Net MOIC to LPs

$80M Fund Without SBIC

$80M of private capital

$268M gain on $80M of capital

3.4x Net MOIC to Investors

3.4x Net MOIC to LPs