\n<\/p>\n
Former Founders Fund GP Brian Singerman and co-founder and managing partner of Quiet Capital, Lee Linden, are seeking over $500 million for a new fund called GPx, three people familiar with their strategy told TechCrunch. A portion of GPx\u2019s fund will likely come from Founders Fund co-founder Peter Thiel, these people said.<\/p>\n
GPx uses a two-pronged strategy. The firm will invest approximately 20% of the capital into funds managed by emerging VCs who are targeting pre-seed and seed-stage startups; the remaining capital will go toward partnering with emerging managers on leading later-stage investments (most likely at Series B) of their breakout companies.\u00a0<\/p>\n
It\u2019s a fairly different approach compared with how most venture firms operate. While typical VC firms invest all of their capital directly into startups, GPx is adopting elements of what\u2019s known as a fund-of-funds model, a less common investment strategy where a firm invests some portion of its capital into a portfolio of other funds, rather than directly in underlying assets, such as startups. While a fund-of-funds offers limited partners a convenient way to access under-the-radar or hard-to-access firms, a significant drawback is the dual layer of fees: those charged by the fund-of-funds and those by the underlying managers.<\/p>\n
While capital raised by fund-of-funds firms hit a 16-year low last year, according to PitchBook, Singerman and Linden are betting that their personal brands, unique networks, and a strategy that\u2019s only partially a fund-of-funds will encourage limited partners to open their checkbooks for GPx.<\/p>\n
Singerman and Linden may be on to something. As venture capital concentrates in the largest funds, some of those firms\u2019 best investors are no longer interested in being a part of a big machine. They are leaving the behemoth firms to launch their own investing outfits where they can be more nimble and specialized.<\/p>\n
GPx is betting that the next generation of VC investors will identify and back many strong early-stage companies, allowing Singerman and Linden\u2019s firm to co-lead later-stage investments in the emerging managers\u2019 most successful portfolio companies.<\/p>\n
Here\u2019s where GPx\u2019s strategy becomes particularly valuable: Early-stage VCs often try to exercise pro-rata rights in later funding rounds (Series A, B, and beyond), but their fund sizes typically prevent them from maintaining their percentage ownership in top-performing companies. When faced with such opportunities, small VCs often scramble to raise special purpose vehicles (SPVs) from their existing limited partners. Yet, these processes are time-consuming, allowing other investors to snap up coveted equity spots in the most sought-after deals.<\/p>\n
With GPx\u2019s capital behind them, emerging funds will have an opportunity to not only exercise their pro-rata rights but also lead a later-stage round.<\/p>\n
The Information previously reported that Singerman and Linden are launching GPx, but didn\u2019t provide details about the fund\u2019s target size and other strategy details.<\/p>\n
Singerman and Linden didn\u2019t respond to a request for comment.<\/p>\n
Editor\u2019s note: This story has been updated to reflect Peter Thiel\u2019s involvement with GPx.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":" Former Founders Fund GP Brian Singerman and co-founder and managing partner of Quiet Capital, Lee Linden, are seeking over $500 million for a new fund called GPx, three people familiar with their strategy told TechCrunch. A portion of GPx\u2019s fund will likely come from Founders Fund co-founder Peter Thiel, these people said. GPx uses a<\/p>\n","protected":false},"author":1,"featured_media":10867,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[52],"tags":[3200,4027,1051,4029,2796,4028,1559],"class_list":{"0":"post-10866","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-technology","8":"tag-500m","9":"tag-brian","10":"tag-fund","11":"tag-model","12":"tag-raising","13":"tag-singerman","14":"tag-twist"},"_links":{"self":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/10866","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=10866"}],"version-history":[{"count":0,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/10866\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/media\/10867"}],"wp:attachment":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=10866"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=10866"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=10866"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}