Yes, Virginia, First Round Capital will continue raising funds to invest (Opinion) Files for 7th fund

Tom Paine


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Josh Kopelman / First Round Website

Not that there was a question about it, but a filing hit the SEC this morning indicating First Round Capital's intent to raise a 7th fund . First Round Capital VII, L.P. plans to raise up to $209,392,283 (precisely?). A smaller fund would seek to raise about $11 million.

First Round's past two principle funds raised $175 million each.

And so far, there hasn't been too much to worry about for the VC firm, at least from a macro point of view. Despite hitting dry holes in some sectors, such as apparel and retail (though an eventual Warby Parker IPO could more than make up for that), most of its individual investments there have been small. Uber, which I believe it has mostly exited now, Ring, Flatiron Health and others assure that First Round has an IRR that is the envy of most VCs. And you'd be surprised at how many less publicized investments have turned out well.

But what about the future?

I've often wondered whether Josh Kopelman, whom I don't know personally but certainly recognize has a varied set of interests, would go in a completely different career direction, whether it be political, philanthropic, or to some other transformative business concept he decides to pursue. Which wouldn't necessarily mean walking away from VC, but perhaps dedicating less time to it.

Howard Morgan, who retired, is considered by some to have been the primary designer of First Round's investment logic, and its use of portfolio theory to minimize risk from any one investment or sector. Not that the other seed/early stage funds don't do it, but First Round often seems to do it better. With Chris Fralic's departure, it leaves Rob Hayes as First Round's other most proven dealmaker (and Bill Trenchard has strong experience). Nothing wrong with what's left; just saying its a less proven group.

But First Round's strength, as always, is getting on the scene early and quickly writing a check when it sees a concept or team it believes in.