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Oppo dump! Pritzker’s New World Ventures

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Illinois

* Earlier today, Gov. Rauner told reporters this about JB Pritzker…

And if you want to see how good a businessman he is, go look up how he did with his New World Ventures, you can really see some truth about how good a businessman he is.

* The Pritzker campaign responded…

JB decided to cap new investments from a New World Ventures fund in the aftermath of the national collapse of the tech industry in the early 2000s. He refunded money that had been invested in the fund by those outside of his family and personally reached into his own pocket to pay them back. Since that time, JB Pritzker and New World Ventures, which is now called Pritzker Group Venture Capital, have invested in startup companies that have created thousands of jobs. JB is running on his record of getting big things done for Illinois families and communities, and unlike Bruce Rauner, he does not believe people should be treated like lines on an excel spreadsheet and when you are the governor of a state, you are actually in charge.

As mentioned above, New World Ventures was later renamed Pritzker Group Venture Capital. Click here for more info.

* OK, with that being said, on to the oppo. All emphasis was in the original document…

J.B Pritzker: Investment Genius

J.B. Pritzker Raised His First Outside Investment Funds In The Late 90s

J.B. Pritzker Launched His First Investment Fund – New World Ventures – In 1998 With $10.8 Million From Outside Investors. “Born with one of the most famous names in business, Jay Robert Pritzker is making a name for himself. Outside investors put up the majority of a $10.8-million high-tech investment fund raised last year by New World Venture Partners LLC, the successor to a private venture capital firm Mr. Pritzker launched in 1996 with a $6-million stake from the billionaire Chicago dynasty.” (Paul Merrion, “Venture Vanguard: Pritzker’s At Head Of Class Of Young Fund Teams,” Crain’s Chicago Business, 5/17/99)

In 1999, Pritzker Partnered With William Blair & Co. To Launch His Second Investment Fund – William Blair New World Ventures – With $100 Million From Outside Investors. “Two prominent Chicago financiers — J. B. Pritzker and William Blair & Co. — are teaming up to invest $100 million in the sizzling technology- startup arena. Mr. Pritzker’s New World Ventures has formed a partnership with William Blair Capital Partners LLC to invest in technology firms at their riskiest but potentially most lucrative stage — often before the companies have rung up any sales. The partners’ fund, William Blair New World Ventures, will target emerging Internet, software, telecommunications and networking companies with initial investments between $2 million and $4 million.” (Barbara Rose, “Blair, Pritzker Launch Tech Startup Fund,” Crain’s Chicago Business, 12/20/99)

By 2003, Both Of Pritzker’s Funds Had Suffered Catastrophic Losses
In 2003, New World Ventures Was Down 90 Percent, And William Blair New World Ventures Given Investors Half Their Money Back To Avoid Additional Losses. “Market bubbles don’t distinguish between new money and old money. Whether your name is Andrew ‘Flip’ Filipowski–a self-made software guru starting an Internet incubator–or J.B. Pritzker–a billionaire scion turned venture capitalist–the results of an investing mania can produce similar results… At Pritzker’s New World Ventures, which held limited partners meetings Tuesday, the Evanston firm’s wealthy private investors have been luckier. One of the firm’s funds is down an estimated 90 percent, according to a report from the meeting, while a second fund is giving investors half their money back rather than risking more losses.” (Barbara Rose, “Divine Considering Chapter 11; Pritzker’s New World Ventures Gives Back Funds,” Chicago Tribune, 2/19/03)

• Pritzker Had Raised $10.8 Million In 1998 For New World Ventures – By The End Of 2002 It Was Down To $1.8 Million. “New World’s first fund open to outside investors launched in late 1998: a modest $10.8 million pool with about 60 limited partners. Like Divine, New World was a pioneer: one of the area’s few firms to focus on start-ups with scant financial histories. But like Divine and some other early-stage venture funds, New World has sustained big losses. The first fund’s value at the end of 2002 was an estimated $1.8 million.” (Barbara Rose, “Divine Considering Chapter 11; Pritzker’s New World Ventures Gives Back Funds,” Chicago Tribune, 2/19/03)

• Pritzker Had Raised $80 Million For William Blair New World Ventures In 1999 – In 2003 He Released His Investors From $40 Million In Funding Commitments To Avoid More Losses. “For his second fund, Pritzker teamed up with an old-line Chicago name–an affiliate of regional brokerage William Blair & Co.–to raise about $80 million. Now, New World is releasing limited partners from about $40 million in funding commitments because of what Pritzker terms a severe market ‘downdraft.’” (Barbara Rose, “Divine Considering Chapter 11; Pritzker’s New World Ventures Gives Back Funds,” Chicago Tribune, 2/19/03)

Pritzker Claimed He Had Gotten A “Good Reaction” From His Investors; His Investors Disagreed

Pritzker Claimed He Had Gotten “A Good Reaction From The Vast Majority” Of His Investors. “I think we’ve gotten a good reaction from the vast majority” of investors about the givebacks, Pritzker said Tuesday.” (Barbara Rose, “Divine Considering Chapter 11; Pritzker’s New World Ventures Gives Back Funds,” Chicago Tribune, 2/19/03)

New World Ventures Investors Disagreed With Pritzker’s Characterization, With One Saying “People Are Very, Very Unhappy…They’ve Lost Almost All Their Money. “An investor in the first fund offered a different view. ‘People are very, very unhappy,’ he said. ‘They’ve lost almost all their money.’” (Barbara Rose, “Divine Considering Chapter 11; Pritzker’s New World Ventures Gives Back Funds,” Chicago Tribune, 2/19/03)

* Excerpt from a Rauner campaign press release this afternoon..

Today, Governor Bruce Rauner called out JB Pritzker’s spectacularly bad business record and questioned his taxes. When asked by reporters why JB Pritzker only reported $15 million in income despite his $3.4 billion net worth, Governor Rauner responded by saying “he has to be the worst investor on the planet.”

Here’s a history lesson: In 1998, JB Pritzker started New World Ventures. By 2003, that fund had lost 90% of its value.

In 1999, JB Pritzker started William Blair New World Ventures with $80 million in investments. By 2003, Pritzker returned only half that money ($40 million) to investors after the fund produced poor returns.

(“Divine Considering Chapter 11; Pritzker’s New World Ventures Gives Back Funds,” Chicago Tribune, 2/19/03)

posted by Rich Miller
Tuesday, Dec 5, 17 @ 1:34 pm

Comments

Time to start dredging up the dirt on GCTR.

Comment by A Jack Tuesday, Dec 5, 17 @ 1:38 pm
If Rauner wants to turn this campaign into a “Battle of the Venture Capitalists”, then he should leave his retirement “hobby” and return from whence he came. He is obviously much more comfortable in that world, and he obviously has reaped riches from his (or someone’s) management of those riches. Mine is bigger than yours is not a “business model” for Illinois government or the Governor’s office.

Comment by Anon221 Tuesday, Dec 5, 17 @ 1:39 pm
Haven’t seen the name Flip Filipowski in a while. Remember when he was Mr Chicago Tech?

Comment by Fax Machine Tuesday, Dec 5, 17 @ 1:39 pm
Welp…

If the Pritzker Crew can’t get Oppo on Rauner’s Businesses, they better start realizing… Rauner plays for keeps, will bury you, and by the time y’all want to push back, they’ve done 3 ads, been on radio for days, and y’all will be responding instead of running “Skyhook, in reverse”

Better get another $7 million rolling.

Today.

Comment by Oswego Willy Tuesday, Dec 5, 17 @ 1:40 pm
So, is Rauner saying that Pritzker wouldn’t know how to operate a state budget? Run state government? Be in charge?

Comment by 360 Degree TurnAround Tuesday, Dec 5, 17 @ 1:41 pm
I’d start burying Rauner by linking him to his parents’ wealth. There is a reason he doesn’t want to talk about them. Always with the immigrant grandparents.

Comment by 360 Degree TurnAround Tuesday, Dec 5, 17 @ 1:43 pm
Rather GTCR, not the grocery store. With JB’s money, he could billboard the state with the GTCR’s nursing home scandals and could probably dig up some more interesting stuff.

Comment by A Jack Tuesday, Dec 5, 17 @ 1:44 pm
So many factual errors and lies in this Rauner Oppo dump - absolutely stunning but should we be surprised from the guy who lies about his grandparents?

Comment by Anonymous Tuesday, Dec 5, 17 @ 1:45 pm
Did he give investors $20 gift cards to Jewel?

Comment by Anonymous Tuesday, Dec 5, 17 @ 1:47 pm
So 1:45 anonymous what are the lies in this then?

Fax Machine with you on the Flip thing, all this needs is a March 1st reference for Chicago .com bingo…

Comment by OneMan Tuesday, Dec 5, 17 @ 1:48 pm
Excuse my ignorance when it comes to this stuff, but is the oppo that a Pritzker owned tech fund got whacked by the .com/tech bubble?

Comment by Centennial Tuesday, Dec 5, 17 @ 1:53 pm
So did Pritzkers New World Fund cause 72000 college students to leave Illinois?
No, some gambling rich people lost money.
Over a million people lost services they depend on
During the 2 1/2 year impasse
A dozen or so rich people
Don’t outweigh a million plus
The rich can gamble with investments
It was their choice to invest
The poor disabled and elderly
Didn’t have a choice
Rauner made it

Comment by Honeybear Tuesday, Dec 5, 17 @ 1:54 pm
Anon 1:45-”so many factual errors and lies”

Could you take a moment to pick a name and correct a couple, as you see it? If you support JB, this is important.

Comment by Arthur Andersen Tuesday, Dec 5, 17 @ 1:55 pm
also interested in someone deconstructing JB’s latest commercial about schools and food. this seems to be directed at what he considers a Kennedy strength….helping people of modest means to eat. I have no recollection of JB being a food leader. for that matter of an kids education leader either. he’s stretching.

Comment by Amalia Tuesday, Dec 5, 17 @ 1:58 pm
I don’t see how Rauner leaning on “he is a bad business man, so he will be a bad governor” is going to help him. It just feels like another sign that Rauner doesn’t get it. In his mind, the narrative is “If you are a successful business man, you will be a successful governor. I am a successful business man, so voters will support me. Voters won’t support JB if I show them he did not always succeed at business.”

Comment by Montrose Tuesday, Dec 5, 17 @ 1:58 pm
I’m not sure why BTIA wants to debate venture capital vs. vulture capital.

Comment by Moderate Condor Tuesday, Dec 5, 17 @ 2:02 pm
“I have no recollection of JB being a food leader.”

His foundation funded a big push to expand access to school breakfast in Illinois, so that is real, but it wasn’t as high profile as Kennedy’s stuff.

Comment by Montrose Tuesday, Dec 5, 17 @ 2:02 pm
==he’s stretching.==

Nah, that one’s pretty legit, the White House invited him to some summit on the issue and ID’d him as a leader. I can’t comment on his business acumen (I always thought it was other parts of the family that handled the serious business), but he really has been working at a high level on early childhood education/food for a while.

Comment by Arsenal Tuesday, Dec 5, 17 @ 2:04 pm
Yeah, 1998 was a bad year to start a fund investing in tech companies. It would have been a great year to start divesting in tech companies.

Comment by Ducky LaMoore Tuesday, Dec 5, 17 @ 2:05 pm
Seeing as so far all we really know about JB is that he is incredibly successful businessman, who because he can self fund has been anointed by Cook County Democrats, who thinks all of Illinois problems will be solved by the wealthy paying their fair share

I think both myths have been pierced effectively today by reality served cold.

Comment by Lucky Pierre Tuesday, Dec 5, 17 @ 2:07 pm
==In his mind, the narrative is “If you are a successful business man, you will be a successful governor. I am a successful business man, so voters will support me. Voters won’t support JB if I show them he did not always succeed at business.”==

Well, there’s an internal logic to that, but I agree that voters kinda check out of deep discussions of business tactics. It certainly did Clinton no favors last year.

Comment by Arsenal Tuesday, Dec 5, 17 @ 2:09 pm
How many people did Rauner pay back when he lost their money?

Comment by Anonymous Tuesday, Dec 5, 17 @ 2:33 pm
Honeybear, lousy administrators caused most of the student exodus and out of state schools offering in state tuition for mediocre grades and test scores accounted for the rest.

Comment by Piece of Work Tuesday, Dec 5, 17 @ 2:34 pm
The funny part about Bruce attacking JB is he is missing that Ives is going to use all the JB oppo dumps and crush him on his policy/leadership failures in the GOP primary.
Winter is coming Bruce.

Comment by DuPage Bard Tuesday, Dec 5, 17 @ 2:36 pm
===out of state schools offering in state tuition for mediocre grades and test scores accounted for the rest.===

So… you’re saying Illinois’ best and brightest aren’t taking full advantage of out of state schools and the offers of said schools?

Cite please?

I can imagine a top 5% student with an extraordinary SAT/ACT score going out of state for a full ride, including extra for room and board.

You’re saying Illinois’ best and brightest scoff at such offers?

That’s fun.

Comment by Oswego Willy Tuesday, Dec 5, 17 @ 2:44 pm
Chancellor Jones, UIUC…

===“Given the financial challenges facing higher education over the past 25 months, our focus has been on protecting our students’ Illinois experience and ensuring their success,” Urbana-Champaign Chancellor Robert Jones said…===

I know, - Piece of Work -, “you know”

Comment by Oswego Willy Tuesday, Dec 5, 17 @ 2:47 pm
JB is a good person but not even a bad businessman because he is not in business. In all reality he is a trust fund billionaire which means he doesn’t control his funds. He has great financial resources compared to most but he doesn’t have 100’s of millions to spend as he wishes. Let’s all focus on the candidates political positions and not their cash.

Comment by Rocky Rosi Tuesday, Dec 5, 17 @ 2:48 pm
Thanks Piece of Work
You gave me a good laugh
With your explanation
You also confirmed I
Landed a good hit.

Comment by Honeybear Tuesday, Dec 5, 17 @ 2:55 pm
JB welcome to the big leagues. Hope your team was expecting this before the primary. Seems they are caught off guard.

If only Rauner could govern as well as he campaigns. These last four years would look much different

Comment by Almost the Weekend Tuesday, Dec 5, 17 @ 2:56 pm
I’m starting to think there’s no such thing as a an ethical billionaire and that having an unethical governor is, I don’t know, bad?

Comment by Evanstoniani Tuesday, Dec 5, 17 @ 3:22 pm
We prefer to focus on the yet unfulfilled request for some sharpie person to walk up to Stu Levine and ask if it saddens him that GovJunk does not remember payin’ him $30K a month to “consult”.
Or check with the investors and employees of the GA bank GovJunk wrecked BEFORE the crash

Comment by Annonin' Tuesday, Dec 5, 17 @ 3:32 pm
Pretty hard to argue with GTCR performance but as we now know Rauners success at PE didn’t carry over into the Governor’s office. Pritzger’s performance as reported is pretty pathetic. At least most of the money he lost was his. His recent investment in the healthcare venture reported in the press doesn’t say much about his due diligence. Frankly there is nothing in his background to suggest he will be much of a politician. If all of you are honest with yourselves you will admit that his Democratic support is solely due to the assumption that he will sign whatever Madigan comes up with and he will also back the traditional Union agenda which means the state will continue to lag in jobs, growth and overall fiscal stability. Other the. That he will be great

Comment by Sue Tuesday, Dec 5, 17 @ 4:22 pm