Brian Singerman, former General Partner at Founders Fund, and Lee Linden, co-founder and managing partner of Quiet Capital, are raising over $500 million for a new venture capital fund named GPx.
Why it matters: GPx’s unique investment strategy combines elements of a fund-of-funds model with direct investments, aiming to support emerging venture capitalists and capitalize on their most promising companies.
The details:
- 20% of GPx’s capital will be invested in funds managed by emerging VCs targeting pre-seed and seed-stage startups.
- The remaining capital will be used to partner with these emerging managers to lead later-stage investments, primarily at the Series B stage, in their top-performing companies.
- This approach differs from most venture firms, which typically invest all their capital directly into startups.
- GPx’s strategy is designed to help emerging funds exercise their pro-rata rights and lead later-stage funding rounds, addressing the challenges faced by small VCs in maintaining ownership stakes in high-performing companies.
The fund-of-funds model has seen a decline in recent years, with capital raised by such firms hitting a 16-year low last year. However, Singerman and Linden are banking on their personal brands, unique networks, and a strategy that is only partially fund-of-funds to attract investment.
The big picture: As venture capital continues to concentrate, some of the best investors are leaving large firms to start their own, more nimble and specialized investing outfits. GPx is betting that the next generation of venture capitalists will identify and back strong early-stage companies, allowing the firm to co-lead later-stage investments in the breakout companies of these emerging managers.
What’s next: Details about GPx’s final target size and additional strategic specifics have not been provided by Singerman and Linden, who did not respond to a request for comment. As the fundraising progresses, more information is expected to be released, shedding light on the fund’s strategy and target sectors.