Company: TGap Ventures
Year started: 2002
Industry: Venture Capital
Offices: Kalamazoo, MI
Activity: Early and growth stage investment in companies primarily within the software, life sciences, specialty manufacturing, plastics and communication technology sectors.
Assets Under Management: $50 million
Attended: University of Michigan
Degree: MBA, 1980
Company website: tgapventures.com
“As an entrepreneur, I always thought I needed more money. As an investor today, I’ll tell you most companies just need more customers, a market for their product.”
Venture capitalist Pete Farner, co-founder of early stage investment firm TGap Ventures LLC, was something of an entrepreneur from an early start. During his high school years in Grosse Pointe, MI, Farner didn’t have typical summer jobs. Rather he ran his own painting company, drove a taxi and restored old “junker” cars to make extra money.
Upon graduating from high school, he went to Duke University to get an undergraduate degree in economics, but came back home to attend the University of Michigan for his MBA. As part of his MBA program, he took a class in entrepreneurship. While most of his MBA classmates wanted to join large corporations after getting their degrees, Farner was eager to learn as much as he could about the business world with the goal of someday starting his own business.
He accepted a job at Stroh Brewery Co. right out of college. At Stroh, he held various management positions that taught him the ins and outs of business development, investment banking and growth strategies—all skills that would be critical to his future success. Stroh grew from $150 million to $1.3 billion in revenue during his seven-year tenure.
“Management focused on an ‘exit’ means it’s not focused on its business.”
Farner and partner Jack Ahrens have started two venture capital funds that raised a combined $50 million, funding 14 startup and high-growth enterprises so far. The pair has been involved with more than 100 companies since 1979, including TGap in Kalamazoo. Farner also has raised more than $75 million in venture capital as an entrepreneur. TGap, unlike most larger venture funds, raised a portion of its capital from business executives and other entrepreneurs. Always looking to make a good return on investment and pay back investors, Farner strongly believes the only way to accomplish this goal is through creating a strong, sustainable business, rather than focusing only on an exit or sale.
To that end, Farner has served as founder, CEO and board director, as well as in business development roles for technology, software and service companies, averaging five to seven years with each one. In these positions he has participated in multi-million-dollar deals with more than a dozen Fortune 500 companies, including Anheuser-Busch, General Electric Co., Compaq Computer Corp. and the Proctor & Gamble Co. The vast majority of the companies Farner has been involved with can be found in the Midwest—including a large number in Michigan—and have created hundreds of jobs. Farner also has supported young entrepreneurs at his alma mater by serving as a judge for various funding competitions at the University of Michigan.