Scale’s latest fund is 50% bigger than its last

The enterprise software investor raised $900m for Fund VIII.

  • Firm previously raised $600m for Fund VII less than two years ago
  • New fund will have special focus on so-called cognitive apps
  • Partners in Fund VIII are Stacey Bishop, Rory O’Driscoll, Andy Vitus, Ariel Tseitlin, Alex Niehenke, Jeremy Kaufmann and Eric Anderson

Scale Venture Partners, which specializes in enterprise software investments, has closed on $900 million for its eighth fund, a 50 percent increase from its prior fund.

The firm, based in Foster City, California, did not disclose the names of investors in Fund VIII.

Scale closed on $600 million in 2020 for Scale Venture Partners VII, which included a $25 million commitment from the New Mexico State Investment Council and a $36 million commitment from the Teachers’ Retirement System of the State of Illinois, according to the fund database of affiliate publication Private Equity International.

Fund VIII will back cloud and SaaS software companies, with a particular emphasis on “cognitive” apps, which combine machine learning, API connectivity and sensors to transform how enterprises work.

“SaaS companies exploded in the last downturn, but we see the potential for this new breed of cognitive apps to dwarf that growth trajectory,” partner Alex Niehenke said in a statement. “Software that actually works for you is the future.”

Partner Rory O’Driscoll said, “The last nine months have been a sea change in terms of the funding environment but tech innovation remains strong. Valuations are impacted by interest rates but innovation is not. That is the long term bet we are all making, entrepreneurs and investors alike.”

In addition to Niehenke and O’Driscoll, the partners in Fund VIII are Stacey Bishop, Ariel Tseitlin and Andy Vitus, who were all partners in Fund VII, plus Jeremy Kaufmann and Eric Anderson, both of whom have been promoted to partner.

Additionally, Sam Baker has been elevated to principal, while Noah Gross and John Gianakopoulos have been promoted to vice president. Meanwhile, Javier Redondo has joined Scale as a principal, Craig Rosenberg has been named chief platform officer and Hillá Watkins has been named chief marketing officer.