The investment world has changed a lot in the last decade and so has 500 Startups.
Founded in 2010 as an early-stage venture fund and seed accelerator, 500 Startups launched with a strategy of writing small checks to young companies worldwide. But as many early-stage-focused funds have learned over the years, participating in later rounds is key to benefitting from the pro rata and producing excellent performance figures.
Thus, as 500 Startups announced today the close of its fifth flagship fund at $140 million – its largest fund to date – the 11-year-old fund is rebranding as 500 Global. The new name is meant to reflect that its investment strategy will include investing at the accelerator and seed stages as well as beyond, according to co-founder and chief executive Christine Tsai.
To be clear, 500 Global will continue to invest via its accelerator and back companies at the seed stage. But the firm will also write larger investments into companies, leading or co-leading fundraising rounds, as well as offering later-stage co-investment opportunities to its LPs.
“We know there’s something exciting about being able to expand our scope and follow the founder journey from first check to follow-on rounds toward hopefully all the way to potentially being part of their last check, as well.”
Tsai said the firm would often pass on opportunities when its portfolio raised later rounds because 500 was more focused on the first couple of rounds.
“But venture has changed a lot and what companies need has also changed a lot,” she said. “But it’s important to support the companies and continue to support these founders we backed very early at their late growth stage or pre IPO rounds.”
Tsai wouldn’t disclose LPs, but she said the firm has raised larger commitments from fewer investors for Fund V. She said LPs include a mix of US and international backers.
The firm reported that its first global flagship fund is a top-decile performer with a net TVPI of 11x. Overall, the firm’s portfolio has backed 33 companies that have reached unicorn level, valued at $1 billion or more. Among the top performers in its portfolio are Talkdesk, Canva, Bukalapak, Grab and Shippo.
Overall, it has backed 2,500 companies in 77 countries, from its flagship funds and its regional micro-funds, including in Latin America, East Asia, the Middle East, Africa and Southeast Asia.
Tsai noted Southeast Asia is a fast-growing market for its local fund, called 500 Southeast Asia, which has backed unicorns Grab, Carsome, FinAccel as well as Bukalapak, which went IPO in August and was valued at $6 billion at the time.