|
|
|
|
|
|
|
|
|
|
How Will Federal Policy Changes Alter Venture Investment?
|
|
By Matthew Strozier, WSJ Pro
|
|
|
|
|
|
|
Good day. This week was a whirlwind in Washington: new president, new administration, and a flurry of executive orders affecting sectors important to venture investors. We would like to hear how, if at all, the changes in Washington have altered your investment strategy or thesis. What will you do more or less of? How are your portfolio companies adjusting? Please email responses to vcnews@wsj.com.
Last week, we asked how venture investors decide it’s time to bet on a startup pushing a new technology. Here are some of the responses, edited for length and clarity.
-
Sophie Bakalar, partner at Collaborative Fund: “When we invest, we start with a simple question: ‘If this company succeeds, would it make the world a better or more interesting place?’ The second question is, ‘Would a person who is purely self-interested use this product or service?’—a framework we call ‘The Villain Test’ at Collaborative Fund. The best companies solve problems that grow exponentially more impactful as technology evolves. But what really sets them apart is their ability to tap into something even deeper—an idea so resonant, it becomes a cultural movement.”
-
Andrew Cleland, chief investment officer at Techstars: “When I interview applicants to Techstars, I’m focused on two big questions: ‘Is this a $1 billion opportunity, and are these the right people to tackle it?’ At the pre-seed stage, it’s all about understanding the founding team and their fit with the problem statement.”
-
Nick Bunick, principal, NewView Capital: “The quality of the CEO is often the critical factor that determines whether a startup can break through the noise and become a category-defining company. Exceptional CEOs articulate a clear and compelling vision, allocate resources effectively, attract and retain star talent, are decisive in knowing when to uplevel, and maintain an unwavering focus on customers.”
-
Gardiner Garrard, co-founder and managing partner, TTV Capital: “For us, it’s not about being among the first to bet on a new technology. Since we only invest in fintech, we focus on the challenges facing our industry and then look for companies that have the potential to solve them. When a company applies an emerging technology to solve a known problem, then we have a clear market need and a compelling reason to invest.”
|
|
|
And now on to the news...
|
|
|
|
|
|
|
|
|
|
ShopMy’s marketing campaigns encourage influencers, like Ana Zortea, to join its platform as the creator tech landscape grows more competitive. PHOTO: TYLER JOE
|
|
|
|
|
|
Showing their influence. ShopMy, a technology company that helps brands run their influencer marketing efforts, said it has raised a $77.5 million Series B funding round co-led by venture-capital firms Bessemer Venture Partners and Bain Capital Ventures, The Wall Street Journal reports. The investment values ShopMy at $410 million, up from an $80 million valuation in its most recent round in March 2024, according to people familiar with the matter. Other investors in the new round, which closed in December, include venture firms Menlo Ventures,
Inspired Capital and AlleyCorp. ShopMy offers a number of tools, including those that help advertisers manage their gifting programs, identify effective so-called micro-influencers and generate commerce links for influencers in its network to share with followers.
|
|
|
|
Inside the Elon Musk, Vivek Ramaswamy DOGE Divorce
|
|
|
The Department of Government Efficiency was originally envisioned as a joint Elon Musk–Vivek Ramaswamy mission outside the federal government. Now it is all Elon—and he is inside, WSJ reports. Musk’s vision for DOGE—along with his relentless, 24/7 online promotion of its goals—has quickly won out in President Trump’s first days in office, as Ramaswamy has decamped for his home state of Ohio to announce next week a planned bid for governor in 2026, and the DOGE operation has been installed inside the new president’s administration. Musk has been working this week from a West Wing office, according to a person familiar with the situation.
|
|
GCM Grosvenor Raises Fund to Back Emerging Managers
|
|
|
GCM Grosvenor’s Elevate strategy has raised nearly $800 million to back emerging and diverse managers, helping a next generation of firm founders while providing investors opportunities to invest in the middle market, an emerging manager sweet spot, WSJ Pro reports. The final tally for GCM Grosvenor Elevate Fund I includes a $500 million anchor commitment from the California Public Employees’ Retirement System, one of the nation’s largest state pension funds, that was announced two years ago.
|
|
|
|
|
|
|
|
|
|
|
Funds
Pacific Northwest- and Silicon Valley-focused Madrona closed on $770 million across two new funds. The firm’s Fund X will make initial investments in about 30 startups at the pre-seed to Series A stage, while its Acceleration Fund IV will make later-stage investments in 12 companies.
People
Greylock appointed Mor Chen as a partner, where she will invest in Israel-based startups. Chen most recently oversaw the Israeli portfolio at Accel.
New Enterprise Associates promoted Mustafa Neemuchwala and Hunter Worland to principal. Neemuchwala invests in enterprise technology with a focus on AI, cybersecurity, infrastructure and frontier tech. Worland invests in fintech, commerce and consumer technology. Both joined NEA’s technology investment team in 2021.
Artificial intelligence-focused Rackhouse Venture Capital appointed Brendan Baker as partner. He most recently served as partner at Ridge Ventures.
Deals
Databricks added Meta Platforms as a new strategic investor and closed a $5.25 billion credit facility led by banks including JPMorgan Chase. The Wall Street Journal reported in December on the data-analytics company raising $10 billion in a funding round that valued the company at $62 billion from investors including Andreessen Horowitz and Thrive Capital.
|
|
|
|
|
Highnote, a San Francisco-based payments platform, closed on more than $90 million in Series B funding. Adams Street Partners led the round, which included participation from Oak HC/FT and others.
StackBlitz, a San Francisco-based maker of an AI-powered developer tool used to build websites, secured $83.5 million in Series B funding at a $700 million valuation. Emergence and GV led the round.
Fundraise Up, a Brooklyn, N.Y.-based fundraising platform for nonprofits, landed a $70 million growth capital investment led by Summit Partners.
Method Financial, an Austin, Texas-based startup providing connectivity to consumer credit and liability accounts, scored $41.5 million in Series B funding led by Emergence.
Music AI, a Salt Lake City-based AI-driven music and audio technology provider, picked up a $40 million investment led by Connect Ventures.
Tive, a supply chain and logistics visibility technology provider, snagged a $40 million Series C investment led by WiL (World Innovation Lab) and Sageview Capital.
Arctic Therapeutics, an Icelandic drug discovery and development startup, completed a €26.5 million Series A round from investors including the EIC Fund.
Basetwo, an AI platform for manufacturing engineers with offices in Toronto and Sunnyvale, Calif., fetched $11.5 million in Series A funding led by AVP.
|
|
|
|
|
Here is our weekly roundup of stories from across WSJ Pro that we think you’ll find useful.
|
|
|
|
|
|
|
|
|
|
|
Carlos Miranda worked on an English class writing assignment in San Antonio. PHOTO: KAYLEE GREENLEE FOR WSJ
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
