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Industry Ventures Launches $900M Fund for Early-Stage VCs

Industry Ventures made a significant move in the venture capital landscape with the announcement of a new $900 million
July 3, 2024

In 2024, the landscape of venture fundraising is undergoing a discernible shift: Established VC giants are continuing to attract hefty investments from their limited partners, while newer and smaller funds face escalating challenges in securing capital.

However, amidst this backdrop, Industry Ventures has emerged with a beacon of hope for emerging managers. The venerable firm, established 24 years ago, has just unveiled its latest triumph: a robust $900 million early-stage hybrid fund. This fund is designed not only to bolster emerging managers but also to directly support high-growth startups poised for Series B success, alongside acquiring secondary interests in other emerging manager funds from existing LPs.

This seventh hybrid fund from Industry Ventures marks a significant leap forward, dwarfing its predecessor by over 50%—a $575 million fund raised back in 2021.

Divided strategically, the $900 million fund will allocate 40% to backing VC funds, another 40% to direct investments in promising Series B startups through existing partnerships, and the remaining 20% to acquiring stakes in emerging investment firms seeking exit opportunities from other limited partners.

Roland Reynolds, Senior Managing Director at Industry Ventures, dispels the notion that raising funds is insurmountable for emerging managers in today's climate: "We've witnessed the majority of our managers successfully closing their funds," he affirmed. "While it may take a bit longer, these managers are often achieving larger fund sizes."

Industry Ventures' approach extends beyond traditional definitions of emerging managers, encompassing firms across Funds I through III, with a commitment to nurturing their growth trajectory—provided their fund sizes remain under $250 million and are focused on seeding and Series A startups. This inclusive strategy embraces both seasoned entities like IA Ventures and Altos Ventures, as well as newer funds led by experienced investors transitioning from larger firms.

Highlighting their proactive investment stance, Reynolds emphasized Industry Ventures' recent forays into backing standout Series B companies sourced through their extensive manager network. Recent investments include Relay, an innovative online banking platform, and Cobot, a cutting-edge robotics firm. Direct investments typically range from $2 million to $12 million, reflecting the firm's agility in supporting burgeoning tech stars.

Founded by Hans Swildens in 2000, Industry Ventures has carved a niche as a pioneering secondary VC investor. With the introduction of this latest hybrid fund, Industry Ventures now manages assets exceeding $8 billion, solidifying its position as a stalwart in fostering innovation and growth within the venture capital ecosystem.

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