The decade-long glut of funding in the venture business is finally getting unwound as LPs get choosier and choosier about which venture funds to keep backing. Meanwhile, venture capitalists slogging it out with the new breed of super angels, striving to get in the hottest deals at remotely reasonable prices would probably argue there’s little room in the market for a new firm either. So it’s not exactly the easiest time to raise a new fund.
Enter Bullpen Capital: A new firm that the super angel elite are welcoming with open arms. Why? It aims fill the hole in the market between angels and VCs.
Of course, some people believe there is no hole. Indeed some VCs are creating seed-programs to compete with angels even more directly.
But Bullpen’s founders Paul Martino, Duncan Davidson and Richard Melmon argue too many startups are having to do what we wrote about Klout doing yesterday. If they want to raise more capital they have to pick between aiming for a quick flip or aiming for a homerun, with few options in between.
Bullpen’s founders argue a lot of startups just aren’t ready after one $1 million-or-so round. Maybe they’ve run through their $1 million seed round only to find they need to pivot (swear jar) or maybe it’ll just take another $1 million to know what they’ve really got. Right now, few firms want to fill that follow-on seed round role. That’s why Martino, Davidson and Melmon call themselves “Bullpen” Capital– in a Valley where everyone is trying to be a starter or a closer, these guys see a big opportunity in pitching relief.
The initial fund will be $50 million, to be closed in two stages. The first stage is closed now, and each of the three partners put in their own money.
We trucked down to Bullpen’s offices on Sand Hill Road to hear more about the new firm. In future segments, we talk to partners about sectors they’ll invest in, and how the Valley’s culture hasn’t changed as much as you’d think over the last thirty or so years.
Paul is the CEO and cofounder of Aggregate Knowledge, which is the fourth company that he has founded over his 20 year technology career. Paul was previously the CTO and founder of Tribe Network, which was recently acquired by Cisco. In addition to being a serial entrepreneur, he has held senior business development positions at Intertrust and SkyPilot. The highly scalable architecture of the Aggregate Knowledge discovery platform is based on the research work Paul did on massively parallel...
Duncan is a serial entrepreneur who has spent the past six years as a managing director at a major venture fund, VantagePoint Venture Partners. In 1996 he founded Covad Communications, the leading independent DSL provider. On less than $12M of venture investment, Covad raised over $2B in debt and equity and went public in 1998, reaching a $9B market value. In 1997, he joined InterTrust Technologies as SVP Business Development, and led the IPO in 1999 and the secondary in 2000,...
Richard co-founded NSVG in 2002, and has managed its investment in twelve seed stage companies since 2002, including Broadware (sold to Cisco), BigFix (sold to IBM), Zvents, TubeMogul, Aggregate Knowledge, Superfish, and Shortform. He advised large Japanese high tech companies on using Silicon Valley methods to transform their firms. His clients included Sony, Matsushita, Fuji Xerox, Fujitsu, and Konica Minolta. He has actively participated in the creation and management of a number of companies: Electronic Arts with Trip Hawkins...