AngelList Venture has a new look

On Tuesday, AngelList Venture closed its first tranche of institutional funding since spinning out on its own in 2020. The $100 million round was led by Tiger Global and Accomplice, valuing the business at $4.1 billion.

It wasn’t necessarily expected. The round comes just weeks after the organization’s CEO, Avlok Kohli, told me that the company didn’t need venture money, a stance that AngelList, which was founded in 2010 and split into AngelList Venture and AngelList Talent in 2020 – each with their own CEOs and boards – has long embraced.

Despite its business of helping other startups raise money, AngelList Venture itself has largely resisted the siren call of venture capital and run on what others might consider a shoestring budget. Indeed, prior to raising this massive new round, the larger company, pre-spin out, had raised $124 million across multiple rounds over the years — some previously unannounced.

Likely, its views on venture funding stem in part from an earlier experience involving founder Naval Ravikant, who once felt so cheated by the sale of an earlier company he co-founded, Epinions, that he sued its powerful venture backer, Benchmark.

But also, as Kohli explained during our recent chat, AngelList’s philosophy has long been that companies that raise too much money can hamper their growth as hiring takes center stage, slowing down other aspects of the business. “If your entire focus is on shipping velocity and shipping great products, growing headcount is actually counter to that,” he said.

Kohli knows a thing or two about the impacts of fundraising. Before joining AngelList in 2019, he founded and sold two companies, during which time he had his share of pitch meetings and investor check-ins. He even started a new product at AngelList based on his pain points. The product helps with the nitty-gritty of starting a company, from the incorporation paperwork to banking tools that connect directly to a startup’s cap table. In fact, as it pivots to work on more support SaaS tooling, AngelList is a very different company than it was 10 — or even five — years ago.

So why, despite the initial allergy to capital, did AngelList say yes when Tiger came knocking? Kohli didn’t want to pass up the opportunity. Even if AngelList Venture doesn’t need the capital today, it views its latest funding round as a way to cement a relationship between itself and Tiger, the most active startup investor in the world last year and a powerful outfit with ties – and insights – into a wide range of industries that could prove helpful to AngelList down the road.

In exchange, Tiger gets a clearer view of the pre-seed and seed world, which comes at a good time, given the softening of the late-stage markets (and its partners’ reported plans to allocate $1 billion to early-stage funds). The hedge fund notoriously acts as an index, so why not invest in an index, one investor told me. Tiger is also starting to partner and co-invest with other funds, instead of leading rounds like it did when it first started backing private startups, making the new partnership more understandable.

AngelList is among the most highly ambitious “startups” out there when it comes to product launches. In addition to Kohli’s product offering, just a sampling of other products to be rolled out by AngelList Venture includes roll-up vehicles and a fund to back founders based specifically on how fast they’re able to hire talent. You can imagine the company will find ways to put the capital to work as it continues looking to disrupt how founders think about capital at large.