Strategic investor and endowment bring Pontifax debut fund to $105m final close

The growth capital firm, which had an initial target of $100m, will be offering co-investment opportunities to LPs that also include a large insurer and a fund of funds.

Pontifax AgTech has reached a final close on its inaugural pooled fund, collecting $105 million from institutional and strategic investors.

The California-based firm, which had an initial target of $100 million and a hard-cap of $125 million, had held two interim closes prior to the final milestone. In March 2016, the firm announced it had raised $25 million, before sealing a second close in January 2017 after raising between $50 million and $60 million.

The latter allowed it to bring on board institutional investors, which account for the majority of LPs that contributed to the fund, co-founder and co-managing director Phil Erlanger told Agri Investor on Wednesday on the sidelines of its Chicago Forum.

Spanning North America and Europe, the fund’s investor base includes one large insurance company, one of the US’s largest university endowment systems, a fund of funds and a handful of large sophisticated family offices. A corporate entity involved in the agricultural supply chain, whose commitment will also be used to keep track of technological developments in the sector, also contributed, Erlanger said.

The vehicle will look for co-investment opportunities, bumping up the size of potential equity checks, he added.

Closer to the exit

The firm is eyeing a couple of prospective investments that could be announced in the very short term, Erlanger noted, citing food safety, crop protection systems, water treatment and precision farming as sectors it is focusing on.

Pontifax describes itself as a growth capital firm, investing in proven technology that improve the productivity, sustainability and efficiency of the agriculture supply chain. It is understood that it looks for net IRR returns of around 30 percent. In addition to providing better risk-adjusted returns than earlier-stage ventures, Erlanger explained that growth capital brings companies and their investors closer to the ultimate buyer.