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Open Prairie advances Fund III launch – exclusive

The Illinois-based venture capital firm plans to target up to $100m for its biggest fund yet.

* Updated: removes inaccurate LP history.

Open Prairie Ventures plans to start raising up to $100 million this year for Open Prairie Ventures III after nearly two years of negotiations with potential strategic investors, according to Jason Wrone, vice president at the US firm. It expects a final close in 2015.

Wrone said the firm has since been working to align with strategic investors before officially starting to fundraise and was in discussions with a few  firms for most of 2013; these discussions are still ongoing. It is not using a placement agent.

Open Prairie III is targeting between $75 million and $100 million from institutional investors, family offices, high net worth individuals and strategic investors. Fund III will focus more closely on agriculture technology than its previous two funds that also invested in sectors including medical devices and information technology.

“With our location here in central Illinois, and family legacies spanning more than five generations in agriculture investing, it is natural for Open Prairie to focus on the agriculture sector,” said Wrone. “We are in the heart of the breadbasket of the world, thus providing a robust infrastructure and intellectual capital to help accelerate innovation and build the next generation of leading agricultural technology companies.”

Open Prairie first revealed its intent to raise Open Prairie III in November 2012 when it hired Jim Budzynski as venture partner to “assist with capital raising and identification of initial investment opportunities for the Open Prairie III Fund to be launched in January 2013”, the firm said in a press release at the time.

Should it successfully reach its target, the 10-year Fund III would be larger than Open Prairie’s prior vehicles. This reflects the firm’s desire to invest more capital into each portfolio company, and perhaps into more developed companies, said Wrone. “The expansion into more growth-stage opportunities allows us to further diversify the portfolio and provide greater opportunity for our partners.” He declined to give details on expected deal size or number of deals expected.

The firm closed Open Prairie Ventures I on $40 million in 1999; Southwest Michigan First Life Science Fund on $65 million in 2007; and Open Prairie Ventures II on $30 million in 2010.

Fund II is nearly fully deployed; it will not invest in any new companies but might do follow-on transactions in existing portfolio companies, according to Wrone. Its latest investment was a follow-on investment into NewLeaf Symbiotics, the plant bacteria-focused company.