Next Coast Ventures sees opportunity for more investments in Houston's startup sector.
Austin-based Next Coast Ventures is a group of software and internet investors with portfolio companies spanning from enterprise software to consumer internet and technical services firms, said Thomas Ball, co-founder and managing director at Next Coast Ventures. The portfolio includes two local companies: health technology firm BrainCheck and tech-enabled beauty platform Upgrade Boutique.
Next Coast Ventures wants to connect with more early-stage companies around Houston, Ball said.
"We just continue to think it's a market that's got all of the characteristics we look for in ecosystems, things like great universities, great previous entrepreneurial successes," he said. "And we think there's frankly a bit of a lack of local venture capital. We hope to help fill that void."
The venture fund now has a lot more money to go after deals in the Bayou City and beyond. In late March, Next Coast Ventures announced raising $310 million across three new investment funds. Of the new money, $195 million is dedicated to investments into early-stage tech startups. Next Coast typically invests between $500,000 and $10 million at a time from its main fund.
An additional $50 million is devoted to follow-on investments with larger, successful portfolio companies as they scale.
"We have a number of deals in Fund I and Fund II that are doing really well and will continue to raise additional capital," Ball said. "We want to have the capital available to continue to support our winners."
A third pool of money, around $65 million, is dedicated to Next Coast's "Entrepreneurship Through Acquisition" program. The ETA program is focused primarily on recent MBA graduates who are looking to become entrepreneurs, Ball said. Search founders are given money through the ETA program to go out and search for an attractive technology company to acquire and grow.
Meanwhile, Next Coast's two local portfolio companies are seeing strong growth of their own.
In November 2021, Houston- and Austin-based BrainCheck announced raising $10 million in Series B funding from investors, including from Next Coast Ventures and Austin-based S3 Ventures. BrainCheck is an FDA Class II Software as a Medical Device, or SAMD, used by more than 400 neurology, geriatrics and primary care practices for cognitive health screening.
Upgrade Boutique owner and founder Britney Winters raised $2 million in seed capital last year to scale the boutique's e-commerce platform and open a flagship location on Almeda Road in Houston's Third Ward neighborhood. Mary J. Blige rocked products made by Upgrade during her Super Bowl halftime performance in February.
