Philadelphia’s newest venture capital firm is in the works: Cross Valley Capital.
The joint venture from entrepreneur Jon Gosier and a Miami-based entrepreneur named RJ Joshi is looking to raise $20 million for its first fund. The partners declined to disclose how much they’ve raised so far, but they have secured an anchor investor: Miami-based incubator Rokk3r Labs. They’re targeting high-net-worth individuals and family funds, among others.
They’ve already made one investment, though they declined to disclose it at this time.
Gosier, 34, met Rokk3r Labs CEO Nabyl Charania at Miami’s Black Tech Week last November, and Charania introduced Gosier to Joshi, 35, who’s a director at Rokk3r. (Gosier has also invested in Rokk3r, participating in its $5 million round.)
Cross Valley is a microventure firm, meaning that it fund is much smaller than that of the venture firm giants (First Round Capital’s fifth fund was $175 million, for example). It’s the natural next step for Gosier, he said on the phone Friday. He started out investing his own capital back in 2008, focused on tech companies in Africa, and moved on to working with a group of angel investors at his Philly-based angel fund Third Cohort. The microventure firm, Gosier said, is the right way to jump into the venture investing world.
“To get to the $200 million fund, you’ve got to show a track record of success,” he said. “You can do that easier with a microfund.”
The fund plans to invest in “exponential organizations,” the partners said, using a term coined by Silicon Valley “speaker/strategist/entrepreneur” Salim Ismail. They’re referring to companies that use technology to “achieve productivity outcomes,” Gosier said, like Uber and Airbnb.
They’re looking for wide range of companies, from those in the pre-revenue stage to Series A, Gosier said, but plans to focus on the “bridge round” between seed funding and Series A, hence the name “Cross Valley.”
The fund is a shift from Gosier’s earlier angel fund, which aimed to make investing more inclusive by, for one, bringing non-accredited investors into the fold. The regulatory issues around that became a hindrance, Gosier said. He said he realized that if he wanted to start a fund and fund great companies, he would need to follow SEC regulations to the letter, the way he is with Cross Valley.
One way Cross Valley is staying in line with that vision of making investing more inclusive is that its founding team is made up of people of color, in an industry that’s largely dominated by white men.
“I think the minority investors and fund managers need to get in the game in a real way,” said Charania, 39.
They need to get out there to send the message that these types of investors exist and there are communities that will support them, he said.
Cross Valley doesn’t intend on investing solely in a certain type of entrepreneur (say, only African-American-led companies) because the partners believe that, in order to be taken seriously, they need to succeed at investment in general.
“There are some funds that only look for companies run by African-Americans and whether or not they’re successful, they’re never really considered to be traditional VCs by the rest of the VC community,” Gosier said.
That’s why Cross Valley aims to be a traditional fund first.
“We invest based on our thesis, not on our skin,” Gosier said.
The fund also plans to be location-agnostic, though it aims to be a resource for the tech scenes its partners call home.
Gosier and Joshi plan to work on the fund full-time. Gosier will work out of Center City’s Graham Building, where Pipeline (another Philly/Miami partnership) is based. As for Gosier’s other businesses: D8A is a services company with no current staff and music analyzing software company Predictive Pop is a part-time endeavor, a spokeswoman said.
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