The micro-VCs are growing up. Case in point: Jeff Clavier, who started out as an angel investor backing Web 2.0 companies and then transitioned his portfolio into a more formal venture firm, SoftTech VC. Clavier just finished raising a total of $55 million for SoftTech’s third fund. SoftTech’s main focus is on three areas: mobile, next-generation e-commerce, and cloud-based services.
He launched SoftTech III a year ago with $15 million, with the intention to raise a total of $35 million. When he started raising money this summer, though, he was able to increase that target to $55 million. He also added a partner, Charles Hudson, and a senior associate, Steph Palmeri.
“We raised more because we wanted to invest more in companies we are already invested in,” says Clavier, who came by our New York City offices yesterday to shoot an episode of Founder Stories, where he also speaks about his new fund. SoftTech has already backed 100 startups over the years, including Mint, Eventbrite, Get Satisfaction, FitBit, Fab, and SendGrid.
As a seed-round investor he found it difficult to keep his ownership stake in later rounds, and so like many successful early-stage VCs, he decided to raise a larger round so that he could keep investing in follow-on rounds for the winners in his portfolio. When he started out on his own, he was making $25,000 to $50,000 investments. Then in Fund II, he was making $100,000 investments. Now with Fund III, his average initial investment is $400,000 with the goal to buy at least 5 percent of a company, and keep that stake as long as he can. His largest investment to date is FitBit, which recently raised $12 million (SoftTech has put in “north of $1.5 million” over the past three rounds).
With Fund III, he has already done 23 investments, and plans on doing a total of 60 (which comes to about $25 million for the initial investments). He figures that 50 percent of those SoftTech will do follow-on investments, and that is what the remaining $30 million will be used for. Below is an infographic (from SoftTech portfolio company Visua.ly) breaking down SoftTech’s progression and how its investment activity has changed over time.
SoftTech VC is one of the original micro VC firms, founded in 2004 and backing over 135 early-stage start-ups. Based in Palo Alto, the firm manages two institutionally-backed funds and invests in Silicon Valley, New York, Southern California, Boulder and Canada. SoftTech VC is among the most active investors in early stage consumer Internet and B2B startups, consistently investing in 20 new opportunities a year. We seek great entrepreneurs, differentiated products and large market opportunities. More information...
Jean-Francois “Jeff” Clavier is the Founder and Managing Partner of SoftTech VC, one of the most established seed VC firms in Silicon Valley, having closed 150 investments since 2004. An early angel investor in Web 2.0, Jeff and his team have backed successful startups like Mint (Intuit), Kongregate (GameStop), Brightroll, Milo (eBay), Wildfire (Google), Bleacher Report (Turner), Fitbit, Eventbrite, Sendgrid, Fab, Poshmark and Class Dojo. The portfolio has also seen acquisitions by Groupon, Twitter, Facebook, Yahoo and AOL. The...