“Rolling funds, the rise of solo capitalists, crowd syndicates and team-based seed funds all scream one thing in unison: venture capital is growing and getting unbundled at the same time.” TechCrunch
Emerging Managers are Venture Capital Fund Managers whose assets under management (AUM) range from $25 – $100M and have typically raised less than three funds. These types of managers are playing an important role in the ‘growing and unbundling’ of the Venture Capital landscape as they oftentimes focus on previously overlooked founders and markets. Emerging managers bring unique perspectives and experiences to the world of Venture Capital which is why startups should have a solid understanding of this type of investor as they start their fundraising journey.
How are Emerging Managers Different Than More Established VCs
If we compare established fund managers to emerging fund managers, a known investment claimer holds very true, “past results are not an indicator of future success,”– According to Pitchbook research “Nearly 18% of first-time funds nab an internal rate of return (IRR) of 25% while later funds only exceed that number about 12% of the time”.
Many respected LPs have also reported that emerging managers tend to outperform more established funds that are larger scale.
Other distinguishing attributes of Emerging Managers include:
- They generally write smaller checks
- They’re more hands-on with their fewer number of investments
- They’re focused on brand building
- They’re agile and less organizationally bureaucratic
There has historically been a high-risk bias on emerging managers because of some constraints that they faced in the past with regards to limited partners, but as they “consistently outperform industry benchmarks” you can see that isn’t holding Emerging Managers back from growing rapidly year over year.
Why Would You Want Emerging Managers On Your Cap Table Instead
Emerging Managers usually come with years of experience from larger funds where they had the chance to learn and work with the big players. Since the IRR of their new funds are the key indicator of success for LPs, they are highly motivated to make their investments successful.
As they are also more agile, they are able to bring more innovation and ideas to the table which allows them to recognize and jump on new trends which takes more time for established VCs to react to.
The number of Micro VCs, which are also considered emerging managers, jumped 9x from 2012 to 2019, “The underpinning insight was that the “generalist” approach by legacy VC created an opportunity for bespoke firms that could better support founders at the early stage in their respective markets and that this would lead to improved outcomes.” Kaufman Fellows
Other benefits of emerging managers include:
- They have more real-life experience that’s recent and relevant
- They’re more engaged investors and are more motivated to help you out as they’re establishing their brand
- “At the end of the day, LPs look for evidence that an emerging manager can, and will, identify the best companies in their area of focus, and be able to win those deals based on their approach, skills, and expertise. The best early-stage VCs bring tremendous value to their portfolio, creating a flywheel of entrepreneur referrals which in turn, fosters that GPs’ success, so they can build the next industry-leading franchise.” Crunchbase Ventures
- They have more specialized knowledge pertaining to the focus of your startup.
- “LPs typically look to avoid overfished ponds and overplayed deal channels, so you should make a compelling case for why they should follow you off the beaten path. The best EMs have a unique perspective within their area of focus. The prospective LPs you’re targeting need to agree that the approach and space you’re betting on is an exciting place to spend time.” Crunchbase Ventures
- They serve as a pathway that enables more diversity in venture.
- Emerging Managers include more women and racial minorities than in established VCs, which operate with “predominantly homogenous teams” that have been proven to yield poorer outcomes than in diverse teams.
“Emerging managers are grinders, hungry for success the way a young underdog is against a perennial winner in the sports world. This tightly aligns their goals with LPs – a strong return means both the manager and their partners win.” Gridline
How to Find Emerging Managers
- Filter investors by AUM that are less than $100M and (pre) seed and Series A funding stage on our Connect Investor database
- Emerging manager training programs (Recast Capital, Strut Consulting, Kauffman Fellows, and the VCI Fellowship for BIPOC First-Time Fund Managers)
- Networking Events
- Emerging manager communities (Transact Global, Raise Global)
- VC Guide’s List of Emerging Managers
Emerging Managers to Check-out
Base Case Capital
- Location: San Francisco, California, United States
- About: base case capital is an early-stage venture capital firm focused on the next generation of enterprise software.
- Investment Stages: Pre-Seed, Seed, Series A, Series B
- Recent Investments:
- Ashby
- Supergrain
- Fiberplane
Check out Base Case Capital’s profile on our Connect Investor Database
Conscience
- Location: Miami, Florida, United States
- About: Conscience VC invests into early-stage, science-led consumer companies.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Aqua Cultured Foods
- Last Gameboard
- Wayfinder Biosciences
Check out Conscience’s profile on our Connect Investor Database
Atman
- Location: New York, United States
- About: We partner with inevitable people. We provide leverage, access, and acumen through aligned principles. We partner with founders at the pre-seed and seed stages. At Atman Capital, every founder in our egregore is a partner of the fund.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Chico.ai
- Bamboo
- Pipefy
Check out Atman‘s profile on our Connect Investor Database
NP-Hard Ventures
- Location: Amsterdam, Netherlands
- About: We support early teams in Europe and the US to build the infrastructure, tools, and decentralized platforms that simplify the way we work, by making technology more accessible and unlock creativity.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- tldraw
- Universe Energy
- eDRV
Check out NP-Hard Ventures’ profile on our Connect Investor Database
Empath Ventures
- Location: Los Angeles, California, United States
- About: Empath Ventures is a venture capital firm that mainly invests in psychedelic medicine companies.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Freedom Biosciences
- MAPS Public Benefit Corporation
- Pangea Botanica
Check out Empath Ventures’ profile on our Connect Investor Database
Garuda Ventures
- Location: San Francisco, Bay Area, California, United States
- About: Garuda is an angel fund run by full-time operators Rishi Taparia and James Richards. We spend every day on the founder side of the table.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Paragon
- ConductorOne
- Arena
Check out Garuda Ventures‘ profile on our Connect Investor Database
Lorimer Ventures
- Location: Brooklyn, New York, United States
- About: We’re a Brooklyn-based investment firm made up of founders, operators, and financial professionals with experience building and operating businesses from pre-revenue to post-IPO. We bring a founder-first perspective to each startup we back, and strive to be on a speed-dial basis with the founding teams we back.
- Investment Stages: Pre-Seed, Seed, Series A
- Recent Investments:
- Tyba
- Circuit Mind
- OatFi
Check out Lorimer Ventures’ profile on our Connect Investor Database
m]x[v
- Location: New York, United States
- About: m]x[v Capital is an up and coming early-stage venture fund building momentum for the next generation of cloud disruptors. We bring a founder and operator perspective to the cap table, helping our founders build their vision, product, and teams.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Epoch
- Mailmodo
- Postscript
Check out m]x[v‘s profile on our Connect Investor Database
Brickyard
- Location: United States
- About: Brickyard is an early-stage capital and founder outpost backing builders.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Krepling
- Joon App
- IRON
Check out Brickyard’s profile on our Connect Investor Database
Acquired Wisdom Fund
- About: Acquired Wisdom Fund helps seasoned professionals create scalable technology products. We invest in early stage tech startups.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Achievable
- NOCAP Sports
- Angler AI
Check out Acquired Wisdom Fund’s profile on our Connect Investor Database
True Wealth Ventures
- Location: Austin, Texas, United States
- About: We see value in the impact of women. True Wealth Ventures invests in smart female entrepreneurs, from health innovators to sustainable solution pioneers. Women-led companies have proven they deliver higher returns. It’s time to invest in new perspectives.
- Thesis: Women-led companies improving either human health or environmental health
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- De Oro Devices
- Reharvest Provisions
- Aeromutable
Check out True Wealth Ventures profile on our Connect Investor Database
CapitalX
- Location: San Francisco, California, United States
- About: CapitalX.vc – enterprise focused generalist with $100k – $500k initial checks in preseed/seed.
- Thesis: Women-led companies improving either human health or environmental health
- Investment Stages: Seed, Pre-Seed, Series A
- Recent Investments:
- Simplifyber
- Impossible Mining
- Front Finance
Check out CapitalX’s profile on our Connect Investor Database
Overlooked Ventures
- About: We support founders who operate early-stage technology companies that are historically overlooked and provide them capital, resources, and connections to scale their business. We’ve been in your shoes. We’re tech founders with 10+ years of experience running companies and making deals. Now we’re authentically supporting entrepreneurs with capital and a founder-friendly focus.
- Recent Investments:
- Pipe
- Stagger
- West Tenth
Check out Overlooked Ventures profile on our Connect Investor Database
Chingona Ventures
- Location: Chicago, Illinois, United States
- About: Chingona Ventures invests in founders from backgrounds and industries that are not well understood by the traditional investor.
- Thesis: Focus on industries that are massively changing and founders whose backgrounds uniquely position them to create businesses in growth markets that are often overlooked. Focus areas are in financial technology, female technology, food technology, health/wellness, and future of learning.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Cartwheel
- Sigo Seguros
- Encantos
Check out Chingona Ventures profile on our Connect Investor Database
Forum Ventures
- Location: New York City, San Francisco, and Toronto, United States
- Thesis: B2B SaaS; Future of Work, E-commerce enablement, Supply Chain & Logistics, Marketplace, Fintech, Healthcare
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Sandbox Banking
- Tusk Logistics
- Vergo
Check out Forum Ventures profile on our Connect Investor Database
Dream Machine
- Location: Palo Alto, California, United States
- About: Dream Machine is an opportunistic seed fund interested in consumer and frontier tech. It is founded by Alexia Bonatsos, the former co-editor-in-chief of Techcrunch and one of the earliest reporters to write about WhatsApp, Uber, Instagram, Airbnb and Pinterest. With Dream Machine, she hopes to help exceptional founders make science fiction non-fiction.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- TTYL
- BlockParty
- Powder
Check out Dream Machine’s profile on our Connect Investor Database
VamosVentures
- Location: Los Angeles, California, United States
- Investment Stages: Pre-Seed, Seed, Series A
- Recent Investments:
- Miga Health
- Form Energy
- Zócalo Health
Check out VamosVentures profile on our Connect Investor Database
Revent
- Location: Berlin, Germany
- Investment Stages: Series A, Series B, Series C
- Recent Investments:
- Resourcify
- Noscendo GmbH
- Sylvera
Check out Revent’s profile on our Connect Investor Database
Spark Growth Ventures
- Location: San Diego, California, United States
- About: Spark Growth Ventures is a community driven, early & mid stage, vertical-agnostic, technology venture capital firm. Our mission is to support gritty and exceptional founders in their missions by bringing forth the combined value of our strong community. We are fortunate to have a global network of entrepreneurs, C-level relationships, subject matter experts, world-class talent, institutional investors, high net worth individuals and family offices, many of who are investors in our platform. Our team has several decades of global experience in venture capital, entrepreneurship, innovation, executive & board management, functional leadership and advisory work.
- Thesis: Capital efficient and scalable business model rooted in tech enabled products and services solving real and large problems. Mission oriented and gritty founders are a must.
- Investment Stages: Series A, Series B, Series C
- Recent Investments:
- Redcliffe Labs
- Tab32
- Placer.ai
Check out Spark Growth Ventures’ profile on our Connect Investor Database
Nomad Ventures
- Location: Los Angeles, California, United States
- About: Nomad Ventures is an LA-based Venture Fund focused on Early-Stage Marketplace businesses. The GPs (Chris Taylor and James Mumma) are entrepreneurs who have helped build some of the fastest growing startups in recent history (Uber, Uber Eats, Opendoor) and they support founders by providing both expertise and capital to build the next big tech businesses. ???? ???? ????
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Intro
- Minoan
- Lunch
Check out Nomad Ventures’ profile on our Connect Investor Database
Climentum Capital
- About: Climentum Capital is a Venture Capital firm based out of Copenhagen, Berlin and Stockholm. We invest in European startups that can cut down megatons of CO2 emissions in a concrete and measurable way. The fund targets late Seed and Series A investments into the six sectors that demonstrate the largest CO2 reduction potential: – Industry & Manufacturing – NextGen Renewables – Food & Agriculture – Buildings & Architecture – Transportation & Mobility – Waste & Materials As one of the first Venture Capital funds with a double carry structure (with both financial and impact targets), Climentum is dedicated from day one to evaluate and only invest in companies that hold true carbon reduction potential.
- Investment Stages: Seed, Series A
- Recent Investments:
- Entocycle
- Qvantum
- Continuum
Check out Climentum Capital’s profile on our Connect Investor Database
Seed Club Ventures
- About: Seed Club Ventures is a Venture DAO backing early-stage founders building at the intersection of web3 and community. With a membership of 60+ leading innovators and investors in crypto, we are diverse in our ability to support projects throughout their life cycle. Launched in partnership with Seed Club, the leading network for DAO builders, our mission is to build a community-owned internet.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- Guild
- Stability AI
- Molecule
Check out Seed Club Ventures’ profile on our Connect Investor Database
Capchase
- Location: New York, New York, United States
- About:Capchase is the growth partner for ambitious software-as-a-service (SaaS) and comparable recurring-revenue companies. They help founders and CFOs grow their businesses faster through non-dilutive capital, market insights, and community support. Founded in 2020 and headquartered in New York City, Capchase provides financing by bringing future expected cash flows to the present day – thereby securing funding that is fast, flexible, and doesn’t dilute their ownership.
- Investment Stages: Series B
- Recent Investments:
- Fondo
- Enerex
- BlogTec
Check out Capchase’s profile on our Connect Investor Database
Gold House Ventures
- About: Gold House Ventures is the definitive fund investing in Asian/Pacific Islander-founded companies. We back founders building industry-changing, culturally-compelling businesses by providing a singular suite of services that includes our accelerator, Gold Rush (whose alumni have collectively raised $500 million+); our talent placement vehicle, the Multicultural Leadership Coalition, which partners with leading multicultural funds to increase diversity in Board and Advisory pipelines; media marketing with every major film studio and streaming platform, and access to Gold House’s network of top Asian Pacific leaders across venture capital, media, entertainment, and tech.
- Investment Stages: Pre-Seed, Seed, Series A, Series B
- Recent Investments:
- CreatorDAO
- Xiao Chi Jie
- Blossom.team
Check out Gold House Ventures’ profile on our Connect Investor Database
The Fintech Fund
- About: An early-stage venture fund supporting the best fintech and defi teams.
- Thesis: The Fintech Fund is a $25M venture fund investing in the top 1% of fintech and decentralized finance startups globally. Our focus is split between more established fintech markets in the US and Europe – for which picks-and-shovels SaaS and infrastructure builders will sell into a growing market of buyers – and emerging markets, where opportunities exist for consumer fintechs to dominate winner-take-all markets.
- Investment Stages: Pre-Seed, Seed
- Recent Investments:
- TrueBiz
- GuruHotel
- Yave
Check out The Fintech Fund’s profile on our Connect Investor Database
Vibe Capital
- About: Vibe Capital is a $10m Fund that invests in the Web3, AI, and Deep Science sectors at the Pre-Seed and Seed stage. We seek venture-scale returns by leaning in to the volatility caused by the exponential growth of the Web3, AI, and Deep Science sectors intertwining with demographic shifts and climate change.
- Thesis: Vibe Capital is a $10m Fund that invests in the Web3, AI, and Deep Science sectors at the Pre-Seed and Seed stage. We seek venture-scale returns by leaning in to the volatility caused by the exponential growth of the Web3, AI, and Deep Science sectors intertwining with demographic shifts and climate change.
More here -> https://vibecap.co/thesis/ - Investment Stages: Pre-Seed
- Recent Investments:
- Pipedream Labs
- Circle Labs
- Fauna Bio
Check out Vibe Capital’s profile on our Connect Investor Database
Origins
- About: We’re a new type of VC firm backing legendary consumer founders with an unfair advantage from pre-seed to seriesA. We invest $100k to $500k in consumer tech startups and also come with the power of influence of our LP’s and their 160,000,000 followers. You can reach us at hello@origins.fund
- Investment Stages: Pre-Seed, Seed, Series A
- Recent Investments:
- Matchday
- Stadium Live
- Upway
Check out Origins’ profile on our Connect Investor Database
Portfolio Ventures
- About: The PV Angel Fund is backed by a great mix of investors leading UK angels, successful founders, C-level execs, and corporate NEDs who co-invest alongside the fund and provide strategic support to our portfolio companies.
- Thesis: Co-investing tax-efficient capital in the best UK tech startups alongside lead investors.
- Investment Stages: Pre-Seed, Seed, Series A
Check out Portfolio Ventures’ profile on our Connect Investor Database
Punch Capital
- About: Punch Capital backs early-stage founders who break new ground.
- Thesis: Punch Capital backs courageous immigrants at the earliest stages. We are honored to be among Weekend Fund’s Emerging 50: signatureblock.co/emerging-50.
- Investment Stages: Angel, Pre-Seed, Seed
Check out Punch Capital’s profile on our Connect Investor Database
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