Houston-based venture capital firm Texas Halo Fund plans to close fundraising for its latest venture fund by the end of next week.
Texas Halo Fund expects its Texas Halo Fund IV to be in line with the sizes of its three previous funds, between $5 million and $6 million, Managing Director Kevin King said. The firm opened fundraising on its fourth fund last summer.
While Covid-19 presented challenges to companies across industries, Texas Halo Fund said the pandemic didn’t dramatically impact its deal flow in 2020. The firm made 20 investments during 2020, up from 14 investment made during 2019, King said.
“Of those 20, I think 12 of them were new companies to the portfolio, and eight of them are follow-on investments,” King said.
Texas Halo Fund is fairly industry agnostic when it comes to considering investments into early-stage companies. Managing Director Rob Tucci said around 40% to 50% of Texas Halo Fund’s portfolio consists of startups in life sciences. As opposed to impacting the firm’s deal flow, what the pandemic did was disrupt the journey to U.S. Food and Drug Administration clearance for some of Texas Halo Fund’s portfolio companies.
“Many of our life science deals that are on an FDA pathway towards approach basically lost up to a year,” Tucci said.
Earlier this year, Texas Halo Fund awarded a $50,000 investment prize to CellChorus, a local startup spun out of the University of Houston that provides comprehensive, dynamic analysis of single cells. Texas Halo Fund made the investment during the virtual Venture Houston 2021 conference held in February.
In December 2020, Texas Halo Fund made an investment in Houston-based ImmunoGenesis Inc., a cancer therapeutics startup that has licensed a significant drug portfolio, including technologies based on discoveries made at the University of Texas M.D. Anderson Cancer Center in Houston.
Kyra Doolan, managing director at Texas Halo Fund, said the firm has also carved out a sizable presence in the female tech, or femtech, space. Materna Medical, headquartered in the San Francisco Bay Area, is piloting a clinical device aimed at reducing the incidence of childbirth-related injuries to women during vaginal delivery at the Texas Children’s Pavilion for Women in the Texas Medical Center.
As elective medical procedures went on hold during the Covid-19 pandemic, women looked for convenient alternatives to in-person doctor visits about fertility, Doolan said. She’s seen more and more opportunities in the fertility space recently.
“We have two companies that participate in the fertility space — one is a device, and one is an at-home test,” Doolan said. “Both of those, I think, have benefitted quite a bit out of Covid-19 because of the fact that there’s such a backlog [of elective procedures].”
In January 2020, Texas Halo Fund closed Texas Halo Fund III at $6 million. Halo I was launched in 2012, and Halo II was launched in 2017.
Texas Halo Fund is led by Tucci, King, Doolan and David Steakley.
