True Ventures has closed its inaugural fund with $155 million, which should prompt rejoicing from those still hung over from last week’s TechCrunch party (and from those unable to get an invite).
The San Francisco-based firm was well oversubscribed from its $125 million target, and is among a burgeoning class of first-time fund managers focused on actual early-stage investing. For the uninitiated, actual early-stage investing stands in contrast to the risk-averse, outsized fund-driven trend of expansion-stage investing that has overtaken many brand-name VC firms. Other West Coast examples include Omidyar Network, Sherpalo Ventures, Khosla Ventures, Ridgelift Ventures and Tugboat Ventures. East coasters include Greycroft Partners, Union Square Ventures and Spark Capital.
I had assumed that True picked its name as a reflection of investment strategy, but that is only part of the rationale. Co-founder Jon Callaghan – who once worked in a bike shop – says that it also refers to the practice of perfectly aligning a tire. “It’s very difficult to do, but it results in an incredibly smooth ride,” he explains.
Callaghan has come a long way since the bike shop, having worked at Globespan Capital Partners, CMGI @Ventures and Summit Partners (in reverse chronological order). It was at Summit that he first met Phil Black, who later would move on to ABS Ventures. Black, in turn, met John Burke at ABS, and the pair would team up to form a small firm called Blacksmith Capital. The three now represent True’s general partnership, and are buttressed by VP of finance Braughm Ricke (5AM Ventures, Artiman Ventures) and venture partner Toni Schneider (Yahoo, Oddpost). Burke will remain in Washington DC, while the rest will work out of San Francisco.
True Ventures made four pre-fund investments that have since been rolled into the fund, including: Meebo (instant messaging), Automattic (blogging software), ScanR (capture digital info via camera phone) and Sphere (blog search engine). It also has four deals made since holding a first close: GigaOm (content), SendMe (mobile entertainment) and two undisclosed companies. True Ventures typically wants to be a company’s first backer (seed or Series A), with an initial commitment of between $500,000 and $3 million. You can read more on the firm in Monday’s print edition of PE Week, but the short story is that this is good news for early-stage entrepreneurs.