Announcing Felicis Ventures’ First Institutional Fund

  • On August 1525, 2010

  • by Aydin Senkut

Felicis Ventures came a long way since its inception late 2005 and our first investment in January of 2006. We are really excited to announce our first Institutional Fund in the amount of $40 million along with our newly re-designed website. During a time when most venture funds are facing headwinds in an increasingly dire fund-raising environment, we were oversubscribed by 33 percent over our initial target with an investor syndicate that’s more than 90 percent institutional.

We will continue to invest in groundbreaking start-ups in the consumer Internet and mobile sectors where there is room for tremendous growth. In the past we have correctly identified big winners in key markets ahead of most other players – great examples include Mint in online finance, Brightroll in video monetization, Powerset and Aardvark in search and Meraki in infrastructure. With this new fund, we plan to expand our reach in two ways: fast growing horizontal markets such as mobile applications and e-commerce, in addition to Internet and mobile companies in four verticals – education, healthcare, personalized medicine and energy conservation. In those four sectors, the market potential is in the tens, if not hundreds, of billions of dollars.

Felicis Ventures has made over 60 investments in seed stage consumer Internet and mobile companies to date, and within the last 12 months, more than a dozen have been sold. In total, over 15 Felicis Ventures start-ups have been acquired by companies like Google, Microsoft, Disney, Intuit, AT&T, Twitter and IAC. The speed of these exits is notable – all happened within four to 44 months of Felicis Ventures’ original investment. To put it in perspective, Dow Jones, Venture Source & Campton Capital report that most venture funds took, on average, six to nine years to bring exits to their investors in the last five years.

We are honored and humbled at the same by recent press coverage of our fund including twice (here and here) in Businessweek earlier this year, and today in Wall Street Journal. One thing is sure to stay the same: we are committed more than ever to the success of our founders. It’s an incredible privilege to witness our founders realize their dreams of creating world-class businesses. As an institutional fund, we can now play a bigger, more significant role in their development.

The alignment of interest with our founders is top priority for us. In that vein, we have created a Founders Advisory Board, with Paul Buchheit and Joshua Schachter as two of its first members. I’m confident that their insights and guidance will add tremendous value to our approach and our portfolio companies.

Moving forward our core objective remains the same: we aim to be an important resource to our portfolio companies and continue to help them in concrete, pragmatics ways. Now we can deploy a small team as well as more meaningful funds to do so, and be more responsive in our approach through our core tenets: leveraging the art of connections, alignment of incentives with our founders, utilizing a “prepared mind” approach to pursue our core markets, and building a strong brand through word of mouth.