Weston Wamp talks Monday, March 28, 2016 in the Lamp Post office.Venture capital in Chattanooga
In the past five years, four new Venture Capital funds have been added in Chattanooga to make investments in startup businesses* Dynamo: A new $18 million funds will invest in trucking and logistics businesses* Chattanooga Renaissance Fund: $7.6 million fund started in 2014.* Jump Fund: Female-created fund started in 2013 to invest in women-owned or women-headed firms.* Blank Slate Ventures: The first fund was capitalized with $500,000, which helped Quick Cue grow and ultimately be sold to Open Table for $11.5 million. Additional investment rounds have raised millions more.
A new venture capital fund created to accelerate the growth of trucking and logistic company startups successfully raised $18 million in investments - 50 percent more than its original target and one of the biggest capital raises ever for a VC fund in Chattanooga.
The "Dynamo" fund was formed this year by the principals in the former Access America trucking company to help support other growing logistics businesses, including the 10 startups going through the Dynamo accelerator this summer. The new funds will be one the richest endowed funds ever in Chattanooga and will make investments in early-stage startup businesses looking to bring new technologies to freight movements and storage.
"This fund fills a very specific niche in the venture landscape considering that our team has an operational background in logistics as well as an extensive early stage investing track record," said Lamp Post Ventures Principal Weston Wamp, who led the raise of the Dynamo Fund.
The fund's limited partners include several strategic investors with interests in the logistics and transportation sectors across the South. The majority of the $18 million was raised from Chattanooga-based individuals and investment entities, several of which committed $1 million or more.
"It's beyond what we set out to do [to capitalize the new fund] and we had to cut the spigot off, which shows the interest here in investing in new technologies and businesses in the logistics industry," Wamp said.
The team overseeing the Dynamo Fund includes the original partners in Access America Transport - Ted Alling, Allan Davis and Barry Large - as well as Wamp and Santosh Sankar, the director of the Dynamo Accelerator.
"We want Chattanooga to be the best place in the world to start a logistics company," said Alling, former CEO of Access America Transport and general partner of Lamp Post Ventures. "An important part of that mission is being a source of capital for the the most innovative companies in the transportation and logistics industry."
The fund's first investment was into an autonomous trucking startup located on the West Coast. Wamp said details on that investment will be disclosed at a later time.
The Dynamo Fund is expected to make several investments in October once the 10 budding business ideas for moving or storing freight takes shape and pitch their startup concepts during the Dynamo Accelerator Demo Day on Oct. 4.
The Dynamo Fund is the biggest of the new venture funds added in Chattanooga over the past decade to help seed and capitalize new emerging businesses.
Lamp Post Ventures is the investment arm of the Lamp Post Group, a business incubator in Chattanooga. Lamp Post was the first investor in Bellhops, Steam Logistics, Reliance Partners and Ambition, among many others. The founders of Lamp Post started Access America Transport in 2002, which merged with Coyote Logistics in 2014, and subsequently sold to UPS for $1.8 billion.
Lamp Post is hosting representatives from 10 startup logistics businesses this summer in a business accelerator program designed to help turn the startup ideas into thriving businesses.
Contact Business Editor Dave Flessner at dflessner@timesfreepress.com or 423-757-6340.