Published On: Mon, Aug 17th, 2020

As it adds Jeremy Milken to a partnership, Watertower Ventures nears $50 million tighten for the new fund

Derek Norton and Jeremy Milken have famous any other for twenty years. Over their longtime personal and veteran relationship, a dual Los Angeles-based sequence entrepreneurs have invested in any other’s companies and investment firms, yet never worked together until now.

Milken is holding a thrust into institutional investing, fasten Norton as a partner in Watertower Ventures usually as a organisation prepares to tighten on a $50 million new fund.

It’s an portentous time for both Los Angeles-based businessmen, as a LA try village sees a call of record talent relocating from New York and San Francisco in a newly remote work enlightenment combined by a COVID-19 epidemic.

“I see dual things happen. One people demeanour during a effects of where a market’s going. We’re observant a lot some-more companies that are starting adult now as a outcome of a [the pandemic],” pronounced Norton. “New association arrangement is duty faster than before covid. [And] a lot of try capitalists that have relocated to LA. They’ve changed down to LA for lifestyle reasons and they’re observant that they don’t need to go behind to San Francisco.”

For Milken, a event to get into try now is a duty of a association origination and acceleration of digital adoption that Norton referenced. “The pestilence is accelerating change in a marketplace. Things that competence have taken a decade are holding dual years now,” Milken said.

These opportunities are formulating an opening for Watertower Ventures in markets distant over a Hollywood hills. The firm, whose strange topic focused on Los Angeles, San Francisco, and New York, is now slicing checks on investments in Texas and Utah, and spending many reduction time looking for companies in a Bay Area.

Derek Norton, founder, Watertower Ventures: Image Credit: Watertower Ventures

Norton’s latest account is a usually a many new act in a career that has seen a financier span a financial services digital media and a early days of a internet. Norton built Digital Boardwalk, a pioneering internet use provider and a second blurb partner for a trailblazing browser service, Netscape.

Later, during Jeffries Technologies, and a $120 million Entertainment Media Ventures seed and early theatre try collateral fund, Norton was closely concerned in bringing tech to marketplace and focusing on early theatre investments. With that in mind, a Watertower Ventures group, that launched in 2017 with a small, $5 million fund, is a lapse to those roots.

The plan, even during a time, was always to lift a incomparable fund. After initial and regulating a boutique investment banking business during Watertower Group, Norton knew he had to lift a starter account to infer a topic he was operative on.

That topic was to yield a overpass between early theatre companies and vast record companies regulating a network that Norton has built in a Southern California tech and party village over decades.

“We wish to take a contacts during Google, Apple, Facebook, Disney, Microsoft, Cisco, Verizon, ATT, Comcast, and other companies we trust should have a attribute with a portfolio companies, and assistance a CEOs and government teams some-more effectively do business development,” Norton told SoCal Tech when he sealed his initial account in 2017. “We wish to bond them to a right chairman during those companies to emanate a blurb relationship. That has a unequivocally vast impact on early theatre companies, who typically don’t have a low network of relationships, and a ability to get to those form of people. It’s since of a advisory business that we have those relationships, and that’s also because those relations stay uninformed and active, contra people who aren’t in those businesses. It’s roughly a full time pursuit to say that, and that’s where a value-add is.”

Milken, who has spent his veteran career in entrepreneurship, was prepared to try investing, and was closely informed with Watertower and a portfolio, as an financier in a firm’s initial $5 million fund.

“Two years ago we started carrying those conversations,” pronounced Norton in an interview. “As Jeremy exited his business in Sep it combined a event to go out and lift together as a expansion of a partnership.”

Jeremy Milken, ubiquitous partner, Watertower Ventures. Image Credit: Watertower Ventures

With a new collateral entrance in, Norton expects to behind some 30 to 35 companies, he said. And, in a covenant to a initial fund’s performance, that has it in a tip decile of try supports for a vintage, Norton pronounced he was means to lift a collateral amidst a mercantile doubt caused by a COVID-19 pandemic. Some 70 percent of a existent portfolio has been noted up, according to Norton.

Even yet singular partners, a investors who behind try funds, were demure to dedicate collateral to new firms in Mar and April, fundraising returned with a reprisal in Jun and July, according to Norton. The paper opening expected was adequate to woo additional singular partners and particular investors including TikTok arch executive Kevin Mayer, a former conduct of streaming during Disney.

Mayer’s participation in a firm’s financier bottom is a covenant to a firm’s representation to founders. “We perspective fundraising as a large daze for these early theatre companies from their business. We try to broach that network that’s ours to those founders,” pronounced Norton.

“I consider we’re in a singular position starting with a uninformed account here,” says Norton. “Uncertainty creates event and people are bringing solutions. We haven’t beheld any slack whatsoever, we’re operative with twenty 5 companies per week. Since a pregnancy of a fund, we haven’t seen understanding upsurge during this level.”

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