By Sue Cullen
Chris Cogan’s entrepreneurial expertise is widely recognized across Florida, and now he is launching an initiative to bring much-needed venture capital here. Cogan has teamed with veteran financiers Russell Vernon and Ross Barrett, and their new firm is getting started by helping one of Sarasota’s most prized institutions.
The three men formed Sarasota-based Seven Holdings when Cogan joined their firm, BVM Capital, in 2013. The vision behind the new partnership was to emulate the business model of successful firms such as Carlyle and Warburg Pincus where Vernon previously served as head of investment operations, Cogan said.
Like most venture capital firms, Seven Holdings will manage venture capital funds, having launched its first fund with $13 million in committed capital and a target of $50 to $70 million. That fund is focused on Health and Life Science opportunities across Florida and the Southeast but Seven has plans to launch other funds as well, he said.
“In addition to managing our venture capital funds, Seven Holdings has its own capital to invest,” Cogan says. “The firm can make majority investments in promising companies where management feels their domain and operational expertise can shorten the growth curve and produce superior returns.” The first such project involves a venture with Mote Marine Laboratories.
Seven Holdings is making a majority investment in Mote Environmental Services, Inc. (MESI), which includes the sturgeon fish and caviar business developed by Mote a decade ago at the Mote Aquaculture Park on Fruitville Road. “What we are providing to Mote is professional venture capital which brings much more to the table than just money,” Cogan says. Seven’s investors and advisors include an impressive list of successful business leaders and investment professionals responsible for major global corporations across a wide range of industry sectors, he added.
Under the agreement with Mote, Seven Holdings will further commercialize and market MESI’s farm raised Sturgeon filets and the caviar whose reputation has grown with specialty food retailers and restaurateurs, Cogan said. Mote’s Center for Aquaculture Research & Development will remain an active partner and will continue to build on the groundbreaking advancements it has made in developing safe and environmentally sustainable aquaculture practices. These leading edge practices are designed to conserve water and take pressure off of overfished species. Cogan said Seven Holdings is exploring ways to refine and standardize these best practices across the global farm-raised fish industry.
“Our intent is to take that business out of the lab/research institution environment and make it more commercially viable and competitive. Together with Mote, we’re evaluating opportunities to expand the Mote brand across other species of fish and further capitalize on their best practices and advancements in sustainable aquaculture,” Cogan said.
“Instead of using Mote’s financial resources, it now can have real income from this,” according to Vernon. “On a much smaller scale, this could be to Mote what Gatorade is to the University of Florida.” Gatorade was developed by University of Florida researchers in the 1960s, and the university has earned royalties for many years from the sports drink, which now is owned and marketed by PepsiCo.
To date, most of the sales of Mote caviar has been through the volunteer efforts of board members, and this grass roots-type effort coupled with the caviar’s exceptional taste and silkiness has built its reputation as a very premium product. It earned rave reviews during a Celebrity Chefs Tour dinner at Darwin’s on Fourth in December, Cogan said. The caviar also is on the menu of the fabled Napa Valley Restaurant, The French Laundry, the Ritz Carlton, and many local restaurants offering fine dining. It also is sold at retail in Whole Foods, Williams-Sonoma, Morton’s Market, Balducci’s, and Costco. “When we apply sound commercial practices and marketing expertise and resources, Mote’s original vision can now be fully realized,” Vernon said.
Vernon has partnered in successful ventures with Louisiana State University and the Pennington Biomedical Research Institute, and has been the lead investor in many notable companies, Cogan said. Vernon is a West Point graduate with a degree in engineering and holds an M.S.S. from the United States Army War College and an M.B.A. from Columbia University School of Business. During his career, he has held executive positions with large investment firms, including Warburg Pincus, and Commerce Capital Markets.
Cogan started his first business at age 18, and sold it six years later to a public utility. That was just the beginning. Over the years, he built more than half a dozen companies before starting his own boutique private equity firm in 2001, which delivered excellent returns to investors. Cogan is a graduate of Rollins College Crummer Graduate School of Business and has raised more than $100 million in private equity from sources that included Credit Suisse, General Electric, Marriott and Safeguard Scientifics. For some time, his goal has been to launch a venture capital fund, but he has been waiting for the right timing. “A couple of years ago, I met Russ Vernon, who is a seasoned venture capital professional with a strong background in investing,” he said. “Russ and I have a lot of commonalities. We compared notes about what we wanted to do and decided to form a new venture capital entity based in Sarasota, which is how Seven Holdings came about.”
The venture with Mote is an opportunity for the firm to showcase its marketing prowess with a premium product like the caviar and Sturgeon filets, and to commercialize MESI’s existing and emerging environmentally-sound aquaculture systems, which have reduced the industry-average amount of new water used daily from 40 percent to just 15 percent, Cogan said. It also is finding ways to use wastewater and solid fish waste from the operation to grow vegetables and wetlands plants for habitat restoration projects.
“The aquaculture park is 200 acres, and right now only about ten of those are being used. We have the ability to expand size-
wise and across fish species as well as into other areas of sustainable food development” Cogan said. “Our efforts will grow sales, commercialize new discoveries, and develop a steady revenue stream from which Mote can benefit. We see tremendous potential here with Mote, and there are many other life science and research institutions, universities, hospitals, and promising companies creating exciting new technologies and science that we can bring into the mainstream.”
For more information on SEVEN Funds call 941.366.7770, or visit sevenfunds.com