A new venture capital fund has entered the Dallas-Fort Worth entrepreneurial community, making its first two deals in Dallas startups. Deep Space Ventures officially launched on March 1, and has already invested in Dallas startups Panamplify and Vinli, and Dallas-based accelerator program Tech Wildcatters. The fund is run by managing partner Stephen Hays, a former investment banker who most recently served as an executive at SunTrust Robinson Humphrey, the investment banking arm of SunTrust Banks Inc.
“The opportunities to invest here are a lot more robust than I expected it to be,” Hays said. “The quality of the ideas is incredible, and I’m seeing Dallas investors start to step up.”
The fund invested $1 million last week in Vinli’s latest round. Vinli, a product that spun out of Dialexa Labs, created a connected car device and platform that launched at TechCrunch Disrupt in San Francisco in 2014. It’s previous round of funding included investments from Samsung Venture Corp., Cox Automotive, The Westly Group and Continental.
Deep Space also has invested $750,000 in Panamplify, serving as a lead investor for its recent $1.1 million seed round of funding. Panamplify spun out of interactive digital agency Extra Sauce and uses intelligent systems to eliminate extra work involved in data analytics and reporting.
The fund’s cash is coming from a successful entrepreneur and oil and gas investor who developed technology that provided geologic analytics on land for oil drilling. The entrepreneur, who prefers to remain anonymous, sold that company, to which Deep Space Ventures’ name pays homage. He has since dedicated his time and money to investing. Racking up 30 years in the oil and gas industry, he’s aiming to diversify his portfolio with technology investments.
With help from Hays, his Frisco neighbor who will help him vet the deals, the entrepreneur hopes to make 20 to 30 investments within the next three years via Deep Space Ventures. Deep Space Ventures is focusing on early stage startups, which include pre-revenue companies, within Dallas-Fort Worth.
“Our ethos is great ideas married to great leaders,” Hays said.
The fund also plans to use local accelerators and incubators as guides to future deals. Deep Space invested $100,000 in Tech Wildcatters this year and will likely continue investments with the accelerator in upcoming years, Hays said.
Other deals will come from Hays’ connections with DFW startup community. Hays has been working with his limited partner for the past two years, presenting four ideas to him. Panamplify was the winning deal, which spurred the development and structure of the fund. Hays would serve as the front man with the limited partner investing the cash.
So far, the community has welcomed Deep Space Ventures, Hays said.
“What I like about the ecosystem in Dallas is its open-sourced,” he said, adding the community added the investment banker and first-time venture capitalist to the community conversations. “I get to interact with ideas before they become Uber or Twitter—it’s refreshing.”