Friday Letter: How firms are expanding amid a pandemic

Icon Ventures, Sapphire Ventures and now Bee Partners are expanding their footprint, taking advantage of a sea change taking place in venture.

I’m not prone to use the cliché ‘silver lining.’ But it’s an apt phrase to describe how GPs and LPs alike are taking advantage of the disruption caused by the pandemic to explore new markets and expand their footprint.

A lot of talk lately has been about how investors and entrepreneurs are relocating to Austin, Miami or other tech centers outside of Silicon Valley, seeking better quality of life, lower taxes and taking advantage of the new and normalized work-from-home status.

But there’s more to it than that.

In January, I spoke with Joe Horowitz of Icon Ventures, who reflected on how underlying the tragedy of the pandemic, the firm sees a silver lining and is expanding its geographic focus, reaching out to companies in areas outside of New York.

That story became more apparent when I wrote last week about how the firm is broadening its global footprint and is seeking deals in Europe. It has also expanded its talent program and opened operations in Toronto to help its portfolio companies recruit engineering talent there.

Earlier this year, Sapphire Ventures also quietly announced it was opening new offices. Among the most significant change was that chief executive and partner Nino Marakovic and Beezer Clarkson, partner and head of the LP arm Sapphire Partners, have opened an Austin office. The firm also has setup a team in London and in New York, just prior to it raising $1.7 billion across several new funds.

This week, San Francisco-based Bee Partners, which sees a growth area in Denver and beyond as start-ups are increasingly interested in moving or expanding to more affordable locations, established a satellite office in Denver.

These are just three examples of how GPs and LPs are taking advantage of the new normal, as many of them call it. As one GP said to me this week, “These kinds of changes are here to stay. We’re not going back to what it was before the pandemic.”

Tell me what you think. Are you looking to expand your global footprint or other silver linings amid the pandemic? You can drop me a note at agoldfisher@buyoutsinsider.com.