SherpaVentures, the venture firm founded by former Menlo Ventures partner Shervin Pishevar and former Goldman Sachs banker Scott Stanford, is finally ready to be less vague about what it’s doing. After a year of raising money and simultaneously making investments, the firm is announcing that it has closed $150 million in financing from limited partners.
Most readers of TechCrunch are probably at least somewhat aware of who Shervin is. He spent a decade as a serial entrepreneur building companies like Webs.com, which sold to Vistaprint for $117.5 million; Social Gaming Network, which merged with Mindjolt; and Hyperoffice, all before moving into venture capital and joining Menlo Ventures.
Shervin was ahead of the curve when it came to making investments in the sharing economy — that is, peer-to-peer marketplaces like TaskRabbit or Getaround. But it was his investment in Uber while at Menlo and close association with the company in the years since that helped make his name in the investor world.
It was that and a propensity for sharing selfies with people like Kanye West on Instagram or flanking President Obama along with Sean Parker at a tech roundtable that made Shervin a bit of a minor celebrity among the tech set. (It’s probably worth noting that Shervin quit social media earlier this year.)
Scott might be the lesser-known of the two, but he’s no less connected. People might know him as a banking guy — while at Goldman Sachs he had a hand in pretty much every big tech IPO over the past few years, including Facebook, Zynga and Groupon.
But he’s also a nerd at heart. Scott started coding at the age of 12, working at the local computer store. Later, when he got to college he won the university robotics challenge, even though he wasn’t a computer science major. After a stint as an analyst at Goldman, Scott moved to San Francisco and joined online search company Looksmart, where he held a wide range of biz dev and corporate development roles.
Scott got sucked back into Goldman in 2004, around the time that investors’ appetites for tech investments started to heat up again. He co-led the firm’s Global Internet Investment Banking practice out of its San Francisco office and ended up making about $600 million of investments into companies including Facebook, Uber, DST, and LinkedIn during that time.
A Modern Bromance
Both Shervin and Scott were in the Uber Series B deal, but they didn’t know each other at that time. The two were introduced by Kara Swisher at the D10 Conference in 2012, and became fast friends after that, according to Stanford.
They hit it off while talking about Uber, which neither of them saw as a pure transportation company. Shervin loved the logistics and delivery angle, while Scott was excited about the bigger opportunity in payments.
The two kept in touch, and saw each other again in late September at Kevin Systrom’s birthday party at a club in Las Vegas. Scott said they should start a fund together, and showed Shervin some slides on his iPhone that he had prepared to pitch a tech fund internally at Goldman.
But they decided to work together a few weeks later at the F.ounders conference in Dublin. Someone lent Shervin a car and driver during the event, and the two spent about 19 hours driving up and down the Irish coast and talking about everything from e-commerce to the singularity, according to Stanford.
“There was something very special… I don’t mean to sound corny, but those are the facts. We discovered a real deep appreciation for each other,” he told me.
It wasn’t until the following February that the two would make the pact official, and announce the creation of a new kind of fund that was “vague, by design.” In the past year they’ve worked to secure investment from LPs while simultaneously making their initial investments.
A Big First Fund
While most first funds start small — in the $20 million to $40 million range — it was important for SherpaVentures to secure $150 million, according to Stanford. Based on the firm’s model, it made sense to allocate about $75 million per partner, so that it could write checks in the companies it believed in, while also having enough money to follow on in its winning portfolio companies. Stanford added that when it comes time to raise the next fund, it will also be for about $150 million.
The firm was anchored with an initial investment by TPG, which invested in Uber’s Series C round last summer and, as a result, knows Shervin and Scott pretty well. But it’s since secured a total of $155 million in LP money to invest in Series A, Series B, and to a lesser extent, seed investments.
The firm has already made five core investments where it’s taken board seats. Some of those — like Munchery, Storehouse, and Shyp — have been announced, while some others have not.
Their background with Uber and other marketplace businesses means they can guide a roadmap for companies like Munchery and Shyp as they look to expand into new markets. And they each have a deep list of contacts throughout the industry to help companies build new partnerships and bolster their executive ranks.
To date SherpaVentures has remained mostly under the radar, as Scott and Shervin have been more focused mostly on helping portfolio companies over the past year. Now that its fund has closed, though, you can probably expect that to change.