With venture capital expanding in recent years as more emerging funds look to connect with a growing pool of LPs worldwide, fund managers and LPs alike face challenges in trying to connect, much less finalize a commitment.
That problem is what Revere VC is hoping to solve for the LPs and the GPs.
The San Francisco and Hong Kong-based asset management firm launched this week and rolled out what it calls The Portal to provide LPs access to a curated list of investment opportunities in venture capital. Essentially, Revere VC aims to help LPs connect with emerging GPs.
“We’re seeing wave after wave of emerging managers encounter that pain point of making a connection and raising capital,” said Eric Woo, co-founder of Revere VC. “We’re hoping to solve the supply and demand of capital.”
Woo said the firm is targeting two audiences, the supply side and the demand side, or rather emerging managers and deal sponsors as well as the LPs, consisting primarily of family offices, wealth management firms and advisory firms. Woo said the focus is on North America and Asia-Pacific, but added that The Portal, which has been in beta testing mode since January, already has a waitlist that extends to four continents and 13 cities, with strong interest from fund managers and LPs alike.
Woo said the asset allocators the firm is engaged with mostly include high-net-worth individuals and family offices. He described them as looking to build venture as a permanent component of their investment portfolio.
The funds Revere VC is seeing largely consist of first-time fund managers, are mostly run by solo GPs and are looking to raise on average $50 million-$100 million for early-stage investing. He said about half of the firms they are seeing fall under the diversity header of being run by GPs who are female or people of color. He said the key demographic is that the VCs have not yet established connections with an LP network needed to raise funds.
“Great fund managers don’t know how to connect with the LPs,” Woo said. “Meanwhile, for the LPs, it’s a noise problem. They ask us to sort through the pool of candidates.”
The launch of Revere VC comes at a time when the number of accredited investors has swelled and non-institutional capital has also increased dramatically. With more emerging managers raising funds and more sources of LPs, services are cropping up to connect the demand side with the supply side.
Take, for example, Oper8r, headed up by Winter Mead, who was formerly a principle on the LP side at Sapphire Ventures. Oper8r was launched last year and bills itself as a Y Combinator for emerging managing venture capitalists to learn the ropes and connect with LPs and raise institutional backing.
Earlier this year, longtime venture banker Samir Kaji, who regularly blogs and tweets about GP-LP relations and trends, split from First Republic Bank and launched Allocate, which is still in stealth, but describes itself as a platform to help LPs find compelling fund managers, as Venture Capital Journal previously reported.
In discussing the launch of Revere VC, Woo noted that increasingly, exposure to the asset class is through novel investment products, such as these. He said Revere VC is about bringing interesting and innovative fund managers to the modern asset allocator.
Woo said that the firm is not a placement agent and it is not acting as a fund of funds. He described it partly as an indexing service, helping LPs to pick what funds to invest in.
But he added that The Portal is the first product the firm is rolling out, and other services they plan to launch include “a build your own fund of funds,” a fund mechanism for an LP to invest, for example, $1 million through Revere VC to back 10 emerging managers.
“This is the democratization of venture, the next wave of VC,” Woo said.
Founders’ LP history
Woo and co-founder Chris Shen are steeped in the LP world.
For the past two years, Woo was head of institutional capital at AngelList, which is a strategic backer of Revere VC. At AngelList, Woo focused on the platform’s community of angel investors and emerging fund managers to form funds and raise capital. Prior to that, he was a principal at Top Tier Capital Partners, a San Francisco-based LP.
Shen is a founding partner of West 22nd Capital Advisers, a Hong Kong-based single family office and investment firm.
Included in its launch, Revere VC also announced this week it raised $1.35 million in seed financing to bankroll its operations. Backers include AngelList, as well as Twitch co-founder Kevin Lin and Thailand-based Siamrajthanee Group/SeaX founder Nattaphol Vimolchalao.
Other investors include Invariantes Fund in Guatemala, HS Group co-founder and chief investment officer Michael Garrow, Hong Kong-based family office investor Ariel Shtarkman, asset management firm Blue Future Partners, Mindworks VC’s David Chang, Color Health Head of Operations Doug Ma, corporate VC advisor Mark Klopp, Brave Dynamics founder Jeremy Au and Amplify.LA’s Paul Bricault, among others.