It’s no surprise that early-stage companies, especially in Wisconsin, can have difficulties raising money.

That’s because all the money is on the coasts, and VCs aren’t willing to travel for small investments, Brian Birk of Sun Mountain Kegonsa said Tuesday at the monthly WIN luncheon at the Sheraton Hotel.

“We feel that there’s a real fundamental funding gap in Wisconsin,” Birk said. “When a company needs to raise $10 million-$15 million, the VCs from California will travel here, but the VCs won’t travel for an investment of $400,000.”

Birk’s group aims to fill that gap. Sun Mountain Kegonsa, which manages the State of Wisconsin’s Badger Fund of Funds, wants to help “minnows,” companies that need to raise several hundred thousand dollars instead of several million.

Birk explained that with a typical $2 million to $3 million Series A round, most VCs will only make one investment per quarter. With his “money for minnows” approach, he is hoping for VCs to make 10-12 investments per quarter.

The Badger Fund of Funds was formed to invest in Wisconsin venture capital funds that will in turn invest in Wisconsin-based startups. The state has committed $25 million to the fund, with the private sector expected to commit an additional $5 million or more and Sun Mountain Kegonsa committing $500,000.