VC firm First Round Capital has steadily expanded its The Dorm Room Fund from Philadelphia, to New York. And today, the firm is heading west with its latest Silicon Valley and San Francisco Bay Area-based initiative, which is a $500,000 fund run by an all-student investment team to invest purely in student-run startups in the area. You can find out more about the Bay Area Fund here.
We’re told the first Dorm Room Fund Bay Area Investment Team is composed of 10 students from Stanford and Cal Berkeley. As we explained previously, First Round puts around $500,000 into a fund student startups in the area. The student-run investment team source investments and make decisions unilaterally to invest in startup ideas. As students graduate, more will be added.
The average each investment is around $20,000, and is structured as an uncapped-convertible note First Round signs off on every investment and is available to the student group to consult on questions, but this is largely run by the students. In fact, First Round will conduct a training for the group with the goal of helping them to understand investment philosophies and scout out interesting ideas and businesses independently. Any carry made by the investment (i.e. if the startup is acquired) is put back into the universities.
The Silicon Valley team is composed of Mediha Abdulhay (UC Berkeley), legendary investor Vinod Khosla’s son Neal Khosla (Stanford), Ryan Jung (UC Berkeley), Bastiaan Janmaat (Stanford), Ruby Lee (Stanford), Adam Goldberg (Stanford), Rick Ling (UC Berkeley), Anjney Midha (Stanford), Amanda Bradford (Stanford) and Jeremy Fiance (UC Berkeley).
Philadelphia Dorm Room Fund launched last year and already has committed 9 companies so far including Dagne Dover, Firefly and Whamix.
As we’ve mentioned in the past, it’s good for the startup ecosystem to help students find capital to get their ideas off the ground. Not only is it a great way to actually find interesting ideas that could be the next Facebook or Google, but even if these ideas don’t end up turning into products, First Round is finding and fostering promising talent.