D.C. venture firm Revolution is rolling out a new seed fund that’s designed to help entrepreneurs in cities outside of San Francisco, New York and Boston.
The $150 million Rise of the Rest Seed Fund is looking to make deeper investments in startups than the $100,000 checks cut at stops on Steve Case’s bus tours.
According to a blog post from the AOL cofounder, the fund will make initial investments up to $1 million. The fund won’t lead rounds or provide board members, and will look to partner with other regional investors on a deal. It will seek to contribute about 10-20 percent to a round.
“Our hope is that our involvement will bring momentum to help spur growth and further investment capital,” Case wrote. “We will also work to build a network of regional investors and entrepreneurs, to create the kind of syndicates and network density that makes Silicon Valley so successful.”
We're launching a $150M #RiseOfRest Seed Fund with a group of iconic #entrepreneurs and investors to continue investing in #startups outside of Silicon Valley. Learn more about our new Fund here: https://t.co/YLnAju4xNB pic.twitter.com/LAJdHwpKMi
— Revolution (@revolution) December 5, 2017
The fund is led by Managing Partner J.D. Vance, the Hillbilly Elegy author who joined Revolution earlier this year. The investment team also includes Revolution’s Anna Mason and David Hall.
According to Case, part of the idea behind the fund is spreading some of what worked in Silicon Valley and other locales throughout the country. To that end, the fund is backed by big names in tech like Amazon’s Jeff Bezos, Alphabet’s Eric Schmidt, Sara Blakley of Spanx, former Facebook President Sean Parker, HPE CEO Meg Whitman, Ted Leonisis and BET cofounder Sheila Johnson. In all there are more than 20 names on the list of backers, some of whom are limited partners. Members of the Koch, Walton and Pritzker families also invested.
“All told, it may be the greatest concentration of American wealth and power in one investment fund,” the New York Times’ Andrew Ross Sorkin wrote this morning.
While it remains to be seen how the fund will influence the D.C. startup community, the fund marks an evolution of the Rise of the Rest project after four years of road trips (which have included cities in Technical.ly markets like Baltimore and Philly). Case foretold a big year for the effort. Given his often-made point that 75 percent of the country’s investment funding goes to startups in three cities, it makes sense that capital would be the basis for further growth of the effort. With Case’s near-preacherly devotion to that message, the list of backers indicates he’s been able to get influential names onboard, as well.
“People know that the future of America is tied to more than just three cities, and there is an eagerness, now more than ever, to address the investment gap,” he wrote.
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