New Fund Alert | Q1 '25

In the first quarter of 2025, a number of venture capitalists at Tier-1 funds left their shops to either start an emerging fund or join a rival firm.

A couple of factors can explain the shift.

The largest VC funds have morphed into asset management firms, with a variety of product offerings and private equity sized funds:

• In 2024, 9 mega-VCs raised $35B, or half the total amount of venture funding, according to Pitchbook

Management at Sequoia / a16z level firms have been focused on the growth needed to go public, while investors at those funds feel that producing top-decile returns is near impossible with the fund sizes at stake.

The disconnect has forced multiple key investors to jump ship:

→ Bilal Zuberi left Lux Capital to found Red Glass Ventures

→ Matt Miller left Sequoia to found a European focused venture fund

→ Rex Woodbury left Index Ventures to found Daybreak

Another driver is the relative ease of launching a venture fund today compared to the past.

Tools like AngelList, Carta, Sydecar, and others have significantly reduced the expenses and administrative burden of launching an emerging fund.

Limited partners at all levels are also more willing to back new managers, especially those with extensive track records. The only caveat here is that the largest institutions typically stick with megafund VCs due to economics.

• Ex: CalPERS investing $20M of a new fund’s $50M target doesn’t move the needle for CalPERS, no matter how well the fund performs. The smallest check CalPERS writes is around $100M and they rarely go earlier than a Fund II or III.

With that being said, I thought it’d be cool to switch things up today and look at the three most interesting emerging funds from Q1 2025…

Let’s dive in

Slow Ventures Creator Fund

Slow Ventures is an ultra successful early stage venture fund that’s invested in 600+ companies including Robinhood, Slack, Venmo, Casper, Postmates, and more. The firm manages $825M+ in assets.

So obviously not an “emerging manager” per se, but the Slow Creator Fund is something new.

The Slow Creator Fund provides seed and growth capital to creator entrepreneurs.

• $1M - $3M check into the creator’s holding company

• equity stake (usually around 10%) and the right to follow-on

• invests holistically, not just into a single project or company from a creator

Slow Creator’s thesis is to back creators who are best in class in a specific vertical who build businesses and launch projects that uniquely serve their audience.

While it sounds like Slow wants to wire checks to Kai Cenat in exchange for a piece of the pie, they’re actually steering clear of large, generalist creators. Slow is targeting niche audience builders.

Before launching the fund, Slow Ventures decided to test out their thesis using a small percentage of dry powder from their flagship vehicle, normally reserved for traditional venture capital investments.

One of their first investments was $1.7M to Marina Mogilko, a language learning creator. It checked off multiple boxes:

• Specific niche / not a generalist. Marina’s focus is on language learning, with other products that fit her brand. She’s not a celebrity but she has influence within the large community she’s built.

• $1M+ of revenue. The fund isn’t backing creators who are in the pre-monetization phase - $1M+ of revenue is the standard.

• YouTube first. Slow Creator prioritizes YouTube creators because (a) it has the best monetization scheme and (b) YouTube fans are more loyal than TikTok, Instagram, etc. Marina built her following on YouTube
  

While the concept of investing in creator led businesses is fun, the elephant in the room is exits. Investors invest in businesses to eventually exit and make a profit. It is quite hard for creators to exit their businesses, which are highly linked to their character.

How do you underwrite creator businesses with such high key person risk?

I’m about to take a left turn but bear with me.

Last year, HY Harry wrote a good article on Ryan Reynolds’ investing track record.

Most of the article goes through why Ryan Reynolds has a pretty mediocre investing portfolio relative to what media coverage would have you believe. But in the midst of that, Harry makes an important observation about institutional capital and celebrities / creators.

“Institutional capital may not be broadly open to some celebrities though. For example, Axios reported that Kardashian’s consumer-focused PE fund, SKKY has only raised $121mm in capital. This is a year after launching and is well below their goals of raising $1B-$2B. I’d argue she’s a skilled brand builder, selling a 20% stake in her beauty business for $200mm to Coty in 2021, as well as growing Skimms into a $4B business. But Kardashian may be struggling to raise financing due to LPs questioning Kardashian’s busy schedule and how exit valuations would be priced if Kardashian’s role in promoting a particular brand isn’t there following an exit.”

There’s an argument to be made that Slow’s thesis strategically avoids celebrities for this reason, and there’s a prediction to be made that Slow will work with creators to mitigate this potential risk.

Team:

• Megan Lightcap - Partner

• Sam Lessin - General Partner

• Kevin Colleran - General Partner

• Billy Parks - Venture Partner

• Jack Raines - Associate

Notable LPs:

• MIT endowment

• University of Michigan endowment

Fund Size:

• $64,000,000

GTMfund

The days of launching generalist funds without any unique edge are over.

GTMfund came to life after people in Max Altschuler’s network started to ask him for help angel investing. So he emailed a list of go-to-market professionals at technology companies and floated the idea of raising $1M between 20 to 50 people to invest in 10 companies and then meaningfully support those companies.

People loved the idea and he ended up raising $22M for Fund I in 2021 with 250 go-to-market operators and a few institutional LPs.

Fund I invested in a number of heavy hitters:

• Vanta | $2.5B valuation - security compliance

• Writer | $1.9B valuation - enterprise generative AI

• Atlan | $750M valuation - AI data center

Two months ago, Max announced GTMfund raised a $54M Fund II.

The goal with Fund II is to invest in 40 early stage companies at the pre-seed and seed stage, with the occasional Series A round; check sizes will range from $500k - $1M.

The operator LP network has blossomed into something bigger than the fund.

• GTMfund hosts six dinners per year + an annual retreat for their operator investors

• Operators have an Slack channel to chat about dealflow

• Each LP can choose to be anywhere from completely passive investors to in the weeds with portfolio companies on go-to-market strategy, building standard operating procedures, etc.

Other funds with a similar structure include:

→ Coalition. Launched in 2022 by Ashley Mayer with a $12.5M fund.

→ Operator Collective. Launching in 2019 by Mallun Yen with a $45M Fund I, raised a $92M Fund II in 2022.

Team:

• Max Altschuler, General Partner

• Scott Barker, Partner

• Vaibhavi Nesarikar, Principal

• Casey Van Maanen, Associate

Notable LPs:

• Bain Capital Ventures

• Harbourvest

• Franklin Park

• 300 operators from Snowflake, Rippling, OpenAI, + more

Fund Size:

• $54,000,000

Daybreak

Rex Woodbury’s new fund embodies the trend of investors leaving megafund VCs.

Woodbury spent time at TPG Growth before joining Index Ventures, where he invested in companies like Persona and Flagship. In 2020, he started writing a Substack newsletter called Digital Native, which has since grown to 65,000 readers.

His announcement introducing Daybreak included the following snippet:

One of the more interesting parts of Daybreak is the transparency relative to traditional venture capital. Rex started formulating the concept for Daybreak in mid-2023, and spent more than a year building out the thesis and raising capital… all while documenting the journey in his newsletter, Digital Native.

In Digital Native, Woodbury talks about building a modern venture platform that maintains the high level of excellence set by leading firms such as Union Square Ventures or Benchmark.

Daybreak’s thesis is that companies that define the next generation will be companies that make life better for the next generation, in the following six categories:

• Health

• Sustainability

• Learning

• Money

• Community

• Job Creation

Team:

• Rex Woodbury

Notable LPs:

• Reference Capital

• Screendoor

• Atacama Ventures

Fund Size:

• $33,000,000

Headlines

• SignalFire raises over $1B as LPs embrace data driven investing. TechCrunch

• Utah Jazz owner forming $1B sports tech fund. Axios

• Transfer portal is the real winner of March Madness. FOS

• Ripple acquires Hidden Road for $1.25B in blockbuster crypto deal. CNBC