Welcome to Philadelphia, First Round Capital.
One of the more respected early-stage investment firms in the country, the longtime West Conshohocken-based venture group is opening a 10,000 sq.ft. office in University City mid-September, managing director Josh Kopelman told Technically Philly.
[Major Full Disclosure: Technically Philly will also work out of the space. Read about why here.]
It’s a move that First Round was considering since at least last February, as Technically Philly reported. Kopelman wrote about the news on his blog this morning.
Kopelman says the office, which is actually in what used to be the first Urban Outfitters store, will have space for five companies and about 25 “drop-in” entrepreneurs, adding that ten members of the First Round team will work out of the new facility.
The renovated building is at 4040 Locust Street, last a bowling alley and adjacent to a new bicycle shop and a planned noodle restaurant on a leafy half residential block at the end of Penn’s campus. Visit the block on Google Maps here.
Kopelman puts the development cost for the new office in the millions but didn’t specify. The building is owned by a development company and the mortgage changed hands in 2004, either through a refinance or otherwise, according to the city’s Office of Property Assessment.
There were a number of reasons for the move, he said.
The recent City Council bill that authorized a tax break for general partners of investment funds was a factor, Kopelman says.
When word made it back to the Nutter administration that First Round was seriously looking at the move, Deputy Mayor Alan Greenberger and Steve Goodman, partner at law firm Morgan Lewis & Bockius met with Kopelman, says Karen Randal, Director of the city’s Office of Business Attraction and Retention.
But above all, Kopelman says the move is about supporting Philly’s tech and entrepreneur community.
“After working in the suburbs for 15 years, I’m trading in my five-minute commute for a longer commute to be closer to entrepreneurs and to serve as motivation for other venture capital firms to move to the city,” he says.
Much of First Round’s attention has been on companies outside of Philly, Kopelman says, so he hopes this relocation can help him play a larger role “in helping the next generation of Philadelphia entrepreneurs grow.”
To be sure, there has been no shortage of ecological development around business and technology in the last half decade here in Philadelphia, but it would be shortsighted to underestimate the importance of having an early-stage investment firm with a national profile choose University City over Conshohocken — and to develop a property near an Ivy League school and mass transit.
First Round’s arrival is not only likely seen as a big win for the tech community, but the Nutter administration is trumpeting it loudly — following big gets like the Bentley Systems satellite office and the relocation of Viridity Energy.
“The arrival of Josh Kopelman in Philadelphia is a game changer,” said Mayor Nutter in a statement. “When one of America’s leading entrepreneurs and investors sees Philly as a place of ideas and innovation, a place where those ideas can be transformed into successful businesses and jobs, and feels he needs to be part of it, that sends an incredibly powerful message about what is going on in our city.”
So now, urbanists might say, we’ve got a major venture capital firm right where we want it to be. The bigger question is: Can First Round start the momentum of VC’s relocating to University City? Kopelman sure hopes so.
“I hope it is a trend,” he says, about his firm’s relocation. “I hope it’s the start of something.”