Fund Briefs, July 2011

Accel Makes Short Work of $1.35B in New Money

Accel Partners announced in June it closed on $1.35 billion of new money for a pair of early and growth stage funds targeting Internet startups and IT infrastructure investments.

The Palo Alto, Calif.-based firm said it raised its $475 million early stage Accel XI and $875 million Growth Fund II in less than three months after kicking off fundraising on April 26.

The new funds double down on Accel’s growth capital while essentially maintaining its present level of early stage money. The firm’s first growth fund, Growth I, closed in 2008 with $480 million of capital.

The 2007 early stage fund, Accel X, came to $520 million while Accel raised $400 million for Accel IX in 2004.

The firm said in a press release that 11 partners would manage the new funds, including Jim Breyer, Rich Wong, Jim Swartz, Sameer Gandhi and Andrew Braccia. In addition, Tracy Sedlock was promoted to COO.

The investment focus for the new funds remains cloud services, next generation IT infrastructure, social media, online commerce, gaming as a service, the consumerization of software and mobile products.

In the past 12 months, the firm has invested in more than 25 seed companies, 14 early stage companies and eight growth companies. Its past growth stage investments include Facebook and Groupon. —Mark Boslet

Facebook Exec to Start VC FundChamath Palihapitiya announced in June he is leaving Facebook to start his own venture firm. Palihapitiya was the vice president in charge of the social media giant’s platform since 2007.

The new firm, tentatively called Social Capital Partnership, will invest in invest in tech, health care and education, and will be funded with $400 million of his own money, according to published reports.

Palihapitiya joined Facebook from the Mayfield Fund, where he focused on consumer Internet and advertising startups. Before that, he was with AOL.TinyCo Launches TinyFundSan Francisco-based mobile game developer TinyCo has launched a $5 million fund, dubbed TinyFund, to support mobile game developers, providing capital and resources. TinyCo develops games for the iOS and Android platforms and recently closed an $18 million funding round led by Andreessen Horowitz.

The TinyFund is designed to provide funding, of up to $500,000 per title, to game developers creating any type of paid or free games played on iPhone, iPad or Android phones. TinyCo said that it will offer marketing, development and business assistance as needed.