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Atlas Venture moves European operation back to Boston

Atlas Venture has announced it will be consolidating both its European and US operations out of one Boston office over the course of 2010.

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Atlas Venture has announced it will be consolidating both its European and US operations out of one Boston office over the course of 2010.

As a result, partner Fred Destin will join the Atlas team in the US.

“Having all of us together in a single location will streamline decision-making and increase overall operating effectiveness,” explained Atlas partner Peter Barrett.

Christopher Spray will remain in London with responsibility for managing the existing European portfolio.

European-based partners Graham O’Keeffe and Regina Hodits, meanwhile, have taken up venture partner roles as part of the move.

The two will concentrate on their existing portfolio companies and will not be making new investments.

In effect, any new European investment decisions will now be made out of Atlas’s Boston office. However, a drop-off in investments in Europe is not necessarily a foregone conclusion, according to Destin.

“We will continue to invest in European businesses, though clearly as we have fewer people doing investments they might be more US-focused. I still believe the European venture market is underfunded.”

Nevertheless, the removal of any operational partners from the ground in Europe suggests there will inevitably be less of a focus on new European investments going forward.

Some industry commentators have seen Atlas’s decision to consolidate in the US as a consequence of a lack of LP interest in European venture, though this was refuted by Destin, who said the move fits in with the trend of having smaller funds.

“We’ve never been as successful as when we managed smaller funds. We didn’t have to do this, it’s about optimising what we do.”

“I’m not sure if I truly believe in the distributed venture model – having four partners in one location every Monday will be faster, more streamlined and more efficient,” he added.

One positive consequence for European portfolio businesses is the heightened access to the US market that the Boston consolidation will bring.

Atlas closed its eighth fund with $283m (€199m) in commitments in December 2008. The total was well down on the $400m that the firm had initially been targeting, and resulted in a slimming down of the firm’s partner headcount, with Ahmet Ozalp leaving the Boston office and Martin Gibson stepping down in London.