Having Fund: The Top Venture Capital Firms in Southern California

Having Fund: The Top Venture Capital Firms in Southern California

A look at the top Venture Capital firms in LA and Southern California.

As Southern California continues to thrive as one of the world’s fastest-growing startup ecosystems, the market has become home to a huge number of startups as well as the venture capital investment funds that help back those startup efforts. Here, top firms that announced large funds in 2019, and some of the venture capital funds working on their next fund.

Fifth Wall Ventures II
Size: $503M (Fund II)
Managing Partners: Brendan Wallace, Brad Greiwe, and Andriy Mykhaylovskyy
Investment Interests: Companies related to real estate
The fund started in June, 2018. Its LPs include a large number of real estate owners, operators, and developers. Fifth Wall’s investments have included such companies as Clutter, Lime, Opendoor, Classpass, Loggi, and many others.

March Capital Partners II
Size: $300M (Fund II)
Founding Partners: Jim Armstrong, Jamie Montgomery, Gregory Milken, and Sumant Mandal
Additional Partners: Meredith Finn and Jed Leidheiser
Investment Interests: AI in the enterprise, industrial IoT and infrastructure, next-gen consumer technologies, and growth in India, plus in eSports and gaming
Santa Monica–based venture investor March Capital Partners said in January that it has raised a second fund, worth $300M. According to March, its new Fund II includes both existing and new investors. The fund is larger than the firm’s first fund, which was worth $240M.

3L Capital

Size: $217M (First Fund)
Managing Director: Shawn Colo
Investment Interests: Consumer and enterprise businesses that are using software, technology, and data across a variety of industries

Los Angeles– and New York–based 3L Capital, a new venture capital investment fund, launched in July. The company says it has raised $217M in a new investment round. The startup investor has already been busy making investments in Los Angeles–area startups and already has investments ChowNow, TYT, SnackNation, and Wheels, along with TheRealReal, 101 Commerce, and others. Colo co-founded the firm with Dave Leyrer (Nexus Group, Boulevard Capital Management) and Kerry Kellogg (RSE Ventures).

Other New Funds

In addition to big fundraising, a number of additional venture capital firms announced new funds or offices in Los Angeles last year:

Wavemaker Three-Sixty Health
Managing Directors: John Nackel, Jay Goss, Eric Marton and Kwame Ulmer
Pasadena-based Wavemaker Three-Sixty Health, the seed-stage healthcare investment fund, says it had the sixth and final close on its fund on December 31, 2019. The firm now has more than 80 Limited Partners in the fund, with the majority being senior level healthcare executives across the US healthcare system. So far, the firm has invested in 29 companies, with about 40 percent of its investment in Southern California companies, and the remainder in Northern California, and the rest of the country and world.

Thin Line Capital
Managing Director: Aaron Fyke
Pasadena-based Thin Line Capital announced in October that it has launched a brand new energy-and-sustainability fund, which will be focused on cleantech investing. The new firm, led by serial entrepreneur investor Aaron Fyke, said its seed-stage fund has had its first close of over $5M. Fyke was previously CEO of multiple companies for Idealab, and cleantech investor at Starfish Ventures in Australia. According to Fyke, Thin Line Capital is looking to capitalize on the “second wave” of cleantech investing, taking advantage of much of the progress in clean tech investments which—unlike the first wave—are a better fit for venture capital investors.

Pelion Venture Partners
Managing Director, Southern California: Jeff Kearl
Pelion Venture Partners, a venture capital firm based in Salt Lake City, Utah, said in October that is expanding its efforts into Southern California. The firm has named Jeff Kearl as Managing Director in the region. Pelion has made investments in such companies as Domo, Redhat, Riverbed, MX Logic, and others. Kearl was most recently CEO of Stance, an online clothing retailer. Kearl sits on the boards of Domo and Scopely, among other companies. Pelion’s latest investments include rounds for MX, Divvy, Astound, and Cloudflare.

Firms raising new funds

Upfront Ventures
Fund: Upfront Growth III
Target Size: $250M
Managing Directors: Mark Suster, Yves Sisteron
Upfront has not detailed any information about the fund, as is usual for venture investors in the midst of fundraising. Their most recent fundraising was Upfront VI, worth $400M, which it closed in June, 2017, and is arguably one of the larger and most visible funds based out of Los Angeles. The new fund looks to be what Upfront has called its “Opportunity Funds,” which it says allow it to follow the full lifecycle of its companies as they get bigger, reach later stages, and require further capital. In prior funds, Upfront had written checks of around $20M and a total of around $40M for its portfolio companies through those opportunity funds.

Kairos Ventures
Currently fundraising: $100M
Investment Area: Commercialization and scientific advances
Beverly Hills–based Kairos Ventures, a venture capital investment firm which focuses on commercialization of scientific advances, disclosed raising the first $24.6M in the first close of a new fund, Kairos Venture Opportunities I, L.P., according to a regulatory filing from the firm. The fund is targeted at an overall capitalization of $100M, per those regulatory documents. According to the filing, so far, 24 limited partners have signed up to the new fund.

Wave Financial Group
Managing Director: David Siemer
Los Angeles–based Wave Financial Group, a new, Blockchain investment company led by former Wavemaker Partners co-founder David Siemer, received a round of funding from London-based Finequia Investments Limited earlier in the year, according to the two companies. Size of the equity investment was not announced. According to the two companies, Wave undertakes early-stage investment, asset management, treasury management, and strategy consulting to enhance the adoption of blockchain technologies worldwide. Wave Financial said the link with Fineqia will give it access to non-correlated, high-quality debt opportunities. Fineqia said its investments in Wave Financial Group represents less than 5 percent of its market capitalization.

Core Innovation Capital
Fund Target: $100M
Managing Directors: Arjan Schutte, Kathleen Utecht
Investment Profile: Fintech investments
Los Angeles-based fintech venture capital investor Core Innovation Capital is out looking for new investors in its third fund, with a target of $100M, according to regulatory filing by the firm in early 2019. The fund counts such portfolio companies as Fair, Honest Dollar (acquired), CoverHound, Mirador (acquired), Nerdwallet, Ripple, Tio (acquired), and many others. As expected, the company has not detailed any information on the new fund. Core Innovation’s latest investments include banking API developer SynapseFi, a funding for cryptocurrency software developer Decent, and an investment in micro-savings startup Blast. The company raised a similar fund, Core Innovation Capital II, LP, back in January of 2017.

Science Inc.
Managing Directors: Michael Jones, Peter Pham, Gregory Gilman, and Tom Dare
In April, Santa Monica­–based startup studio Science Inc. founded by Michael Jones, Peter Pham, Gregory Gilman, and Tom Dare, filed paperwork for a new fund, of undetermined size. The startup studio, which both incubates its own companies as well as working with startup founders to help accelerate their efforts, has backed such companies as Dollar Shave Club, DogVacay, FameBit, EventUp, August Home, Hello Society, Playhaven, and Superfly Labs.

MiLA Capital
Managing Directors: Carmen Palafox, Noramay Cadena, and Shaun Arora
MiLA Capital, the venture capital firm that is behind the Make In LA hardware accelerator, raised its first official venture capital fund in March, officially closing its first fundraise. Size of the fund was not announced. The fund says it has, thus far, made investments into 16 companies since 2015. They are specifically investing in early checks for hardware startups across multiple industries, including agtech, healthcare and biotech, mobility, and aerospace, advanced manufacturing, cleantech, and other areas. Source of the funding for the new venture capital fund was not announced. The investment fund is making investments globally, not just in Los Angeles.