Fund IV: “Think Different”

By David Blumberg

“Think different,” is a Steve Jobs quote I’ve always admired. It is top of mind today as we announce the close of our latest fund, Blumberg Capital Fund IV that was oversubscribed above our $200 million target. Our investment thesis is to find, fund and support passionate entrepreneurs scaling innovative businesses. We’re iconoclastic in our approach and part of our success is because we think different.

Last year was our 25th anniversary, and from the beginning we’ve had a more international investing approach than most other early stage venture funds. We believe it is important to have a truly international fund with a team that is connected in multiple geographies. Founders tell us they’re looking for investors with the connections and expertise where they want to do business, where their customers are and where their potential partners are located. Startups and large businesses aren’t limited to selling into one geography or industry and investors need to be supportive.

The recent trend has moved toward VCs closing sector or geo focused funds. While we see a lot of these funds, typically as a syndicate partner in rounds we’re leading, we don’t believe this model scales well or leads to optimal returns.  

We’ve seen our investment strategy pay off and have been on a  steady trajectory of increasing fund size since Fund I, starting at $37m, Fund II increasing to $91m and Fund III coming to $150m. Fund IV permits us to invest early and to make larger follow-on investments in future unicorns. Two examples of unicorns where we were the first investors include Hootsuite and Nutanix, which just completed it’s very successful IPO last year.  We will continue to lead early stage rounds where we can make the most impact, gain the highest returns and have the most fun.

Over the past couple of decades entrepreneurs have been able to grow and scale companies faster than ever, making it easier to be an early stage venture capitalist. Both VCs and entrepreneurs have benefited from the introduction of SaaS business models, cloud infrastructure, social media networks and mobile connectivity. These are essential pillars for today’s fast growing, disruptive tech ecosystem.  

Looking forward, Fund IV gives us the opportunity to continue to invest in companies that are capital efficient (B2B SaaS, big data, cybersecurity, FinTech, etc.) and explore new technologies and areas of advancement. Three trends we’re particularly excited about are 1) companies seeking to level the playing field and democratize access to services; 2) companies building security into technology and automating rather than relying on flawed human behavior; and 3) companies disrupting traditional industrial businesses as they make their way into the digital age and start to feel the impact of AI and IoT.

Being in the business of technology is being in the business of disruption. Fund IV marks a milestone for Blumberg Capital and we’re looking forward to seeing continued growth within our firm and among our portfolio companies, partnering with new impassioned entrepreneurs across the globe and embracing the new tech revolutions to come.

David J. Blumberg is the founder and managing partner of Blumberg Capital. Follow him on Twitter at @davidblumberg.