It’s not often that an LP joins a venture firm.
But Richard Lam, who for nearly 10 years was with Ontario Teachers’ Pension Plan in Toronto, has been named a partner at Race Capital as the early-stage firm looks to make a push into the Canadian market.
Lam said that Canada provides an opportunity for Race Capital since the region offers a growing number of start-ups and experienced tech talent. The firm cited market data from Refinitiv and noted that in the first half of 2021, venture funds deployed C$7.5 billion ($5.9 billion) across software, blockchain, security and a multitude of other sectors in Canadian companies. That already ties the full-year record of C$7.5 billion set in 2019.
It’s an investment trend the firm hopes to see continue.
“Canada has an incredible base of entrepreneurs,” Lam told Venture Capital Journal. “There are strengths across the board, such as in artificial intelligence and machine learning, things that require deep technical expertise.”
Lam began his stint as a venture capitalist at Race at the beginning of November. He said he then attended the Web Summit in Lisbon before visiting the rest of the Race team in San Francisco. Speaking from Las Vegas last week, he said the goal is to eventually open an office in Toronto, where he is based.
In April 2019, VCJ covered Race Capital’s initial launch, then known as Proof of Capital, as a $50 million fund to invest in blockchain start-ups worldwide. Within a year, the firm rebranded as Race and its fund has expanded to $100 million. Lam said DeFi, or decentralized finance, remains a sector of interest, but the firm primarily invests in the data, enterprise, infrastructure and fintech sectors.
Race Capital primarily makes seed and pre-seed investments, and reserves about half of the fund for follow-on rounds. Lam said the firm prefers to lead deals.
In addition to Lam, the firm’s others partners, all based in San Francisco, include Edith Yeung, a former partner at 500 Startups and a one-time operator; Chris McCann, an angel investor and former community lead at Greylock Partners; and Alfred Chuang, an angel investor and one of the co-founders and former chief executive of BEA Systems, which he led up until its acquisition by Oracle for $8.5 billion in 2008.
Lam said he’s known Yeung for several years. Prior to 500, which is now known as 500 Global, Yeung served as general manager of the personalized mobile browser Dolphin Browser.
lam joins San Francisco-based Race after nearly a decade as global head of VC funds at OTPP, where he deployed some $2 billion into venture and growth equity funds worldwide. He also helped in the formation of the Teachers’ Innovation Platform, an arm of OTPP that makes direct investments. It’s backed such companies such as SpaceX, Epic Games, KRY and FTX.
Race Capital is also an investor in FTX, a crypto derivatives exchange, which is currently valued at about $25 billion, according to CB Insights.
Prior to OTPP, Lam worked at the Boston Consulting Group, Bank of America Merrill Lynch and the private equity firm TorQuest Partners, all in Toronto.
Lam acknowledged that joining a venture firm as a partner is not the usual route for a long-time LP.
“But I’ve had the benefit of seeing thousands of funds,” he said. “And I have learned their best practices and what it takes to be a differentiated player within the ecosystem.”