With IVP’s late-November investment in Deputy, the firm has invested in 15 companies in 2018. That ranks as a busy year for the late-stage investor.
The firm backed 10 companies last year and eight in 2016.
In addition, IVP, which last year raised $1.5 billion for its 16th and largest fund, reports that its portfolio companies subsequently raised more than $3 billion in follow-on funding this year, compared with $1.8 billion in 2017.
Deputy, which provides a workforce management software solution, raised an $81 million round led by IVP.
It joins companies like Brex, Crowdstrike, DataDog, Discord, G2 Crowd, HashiCorp, Hims, Humu, KeepTruckin, Lime, Lulus, Podium, Skydio and UiPath among those the firm has backed in 2018.
G2 Crowd, the Chicago operator of a marketplace for businesses to buy and manage software and services, closed on a $55 million Series C in October. IVP led that round, too, with General Partner Jules Maltz joining the board.
Maltz joined the firm in 2008 after stints as an associate at 3i and in business development at AdMob. IVP promoted him to GP in 2011. Over the years, he has helped the firm invest in Twitter, Yext, Dropbox and MuleSoft, among others.
He recently spoke with VCJ about what drew him to G2 Crowd and other goings on in the venture community.
Q. What drew you to G2 Crowd?
A: The co-founder and CEO, Godard Abel, was previously with SteelBrick, which IVP invested in. Salesforce bought that company a few months after our Series C investment. He’s very good at scaling companies and it’s great to work with him again. He’s a different kind of CEO. He’s concerned about his employees and cares about relationships and how his employees are impacted by what the company does.
G2 Crowd is his third startup. At BigMachines, he had to announce layoffs, and that was hard. So some of the lessons and struggles he learned about operating a company come from that.
Q: What do you look for in CEOs?
A: I look for someone with a purpose. When we looked at Twitter [IVP invested in the Series C in 2009], the first 10 slides of their pitchdeck were about how it was going to help journalists. This was a couple of years before the Arab Spring. I love people who have a mission.
Q: One of your other investments this year was in Hims, the men’s wellness and personal-care site. What drew you to the company?
A: I know Andrew Dudum [an entrepreneur and a co-founder and GP at Atomic]. He’s the CEO and I reconnected with him and I liked what he was doing.
Hims is my first ecommerce deal. They’re filling a gap for men, providing information, diagnosis and prescriptions for skin care, erectile dysfunction and hair loss. I think of it as a lot like a software business.
Q: How does your liking a CEO mesh with your analysis of the company?
A: I’ve regretted investing in companies that had good metrics but I didn’t connect with the CEOs. The hardest part is when you like the CEO but the company metrics aren’t there. So you stay connected to the entrepreneur and you wait for their next venture.
Q: Is this a bad or good time to start a company?
A: As an entrepreneur, you can start a career at any time. We’ve seen in 2008, ’09 and ’10 some great companies were founded but they were not great economic times. A recession can be used as a good filter for purpose-driven CEOs.
Q: You were in Hims’s $50 million round and the company has now raised about $100 million. How have growing round sizes and megafunds affected your business?
A: Companies still have to prove themselves. Grammarly was bootstrapped for years before it raised a large round. [The company was founded in 2008 and raised $110 million from IVP and others in 2017 for its first and only round.]
It’s true check sizes are way up over last year, and fund sizes are also growing. A lot of stories are being written about companies that raised the most money. They get the most press, but they’ve usually burnt the most cash, too.
What’s important is to be impactful for a company’s growth, like Grammarly or Tala in Los Angeles [which has raised about $110 million from IVP and others]. It’s not about jamming a lot of money into a company. You don’t have to lose out on some of the fun parts of the business, like helping a company and its CEO grow.