TCV collects record $4bn for 11th flagship to go after accelerated tech

TCV XI has raised $4bn, a record for the firm during its 25-year history that makes it one of the largest growth equity and VC funds to date.

Kapil Venkatachalam
TCV’s Kapil Venkatachalam

TCV’s biggest-ever fund is poised to reap the benefits of accelerated technologies, Kapil Venkatachalam, general partner at the firm, told affiliate title PE Hub in a recent interview.

TCV XI has closed on $4 billion, a record for the firm during its 25-year history, which makes the fund one of the largest growth equity and VC vehicles to date.

For the Menlo Park, California-based firm, it is also the first vehicle raised on a fully remote basis, an environment that only presented upside, according to Venkatachalam.

As opposed to the significant time that would normally be spent traveling to see LPs in person, “we had a lot more productive diligence sessions and one-on-one sessions with our LPs on both sides remotely,” Venkatachalam said.

With the new vehicle, TCV will focus on sectors poised for sustained growth, including e-commerce, digital media and entertainment, remote collaboration and learning, digital banking, cybersecurity and B2B SaaS, the firm said.

“One of the things that we’ve seen both on the B2B side and B2C side of TCV is the continued acceleration of everything digital,” Venkatachalam said. “People are not necessarily going into their offices. People are working from home, people are almost forced to and willing to experiment with things through their mobile phone, which they historically have not done.”

On the B2C side, TCV has explored everything from telemedicine to online groceries, online support and online sport communities, the investor said. On the B2B side, Venkatachalam said the firm has evaluated some of the harder problems faced by individuals working remotely in the technology area: productivity issues, data explosion amid the shift to cloud computing, risk and compliance, and disruption to global supply chains.

Consistent with that strategy, TCV has already made one investment from its new pool by backing data privacy provider OneTrust in early January.

According to Venkatachalam, data is at the core of innovation and an area TCV is particularly excited about.

“Data privacy is a real problem today,” he said. “OneTrust provides a cloud-based SaaS platform for enterprises to operationalize the data privacy, security and everything related to data governance in one platform.

“We as a firm initially invested in a company [called] Nu Bank, which is a neo bank out of Brazil. That deal led us to another investment – Revolut, out of Europe – and then another one, Mollie.” Mollie led TCV to yet another opportunity, Klarna, which Venkatachalam said is “completely disrupting how you think about payments and how you actually pay for things that you want to buy in the Generation Z environment.”

He said that TCV in Q1 plans to hire an internal recruiter focused on explicitly building a long-term sustainable diversity and recruiting strategy. He added that about 75 percent of the firm’s hires over the previous 24 months had been diverse on the basis of gender or ethnicity.