A new venture capital firm, Chemistry, has raised $350 million for its debut fund, with plans to invest in early-stage startups. The firm was co-founded by Mark Goldberg, previously at Index Ventures, Kristina Shen, formerly with Andreessen Horowitz, and Ethan Kurzweil, a former partner at Bessemer Venture Partners.
Chemistry’s focus is on Series A and seed-stage investments in sectors such as fintech, infrastructure, and developer tools.
The founders, who have all backed notable companies such as Plaid, Twitch, and Sprig, aim to leverage their combined experience to offer hands-on support to startups. In a recent blog post, the firm emphasised its dedication to being “the portfolio services team,” highlighting that all three partners will be deeply involved in each investment. Kurzweil noted that the firm will focus on the fundamentals of venture capital by “stripping away the excess” and committing fully to its founders from the earliest stages.
The team has expressed that while venture capital firms often prioritise scaling, Chemistry will take a different approach by maintaining close engagement with startups. Kurzweil elaborated on this vision, stating that “venture capital isn’t meant to scale” and that they aim to provide intensive support for each investment rather than pursuing rapid growth for the firm itself.
What is the need to launch the new fund?
The decision to launch Chemistry comes at a time when Series A funding has become increasingly challenging to secure for startups. While seed-stage investment remains relatively stable, raising later rounds has been more difficult due to the broader venture capital slowdown. Despite this downturn, Chemistry’s focus on early-stage companies and its hands-on approach appear to position the firm well for success.
Seed-stage investment, according to Crunchbase, remained flat year-over-year in the first half of 2024, but it has held steady above 2020 levels. In contrast, Series A funding has faced increasing hurdles as market dynamics shift. Chemistry plans to navigate this landscape by investing in two to three deals per year per partner, ensuring focused attention and long-term collaboration with portfolio companies.
Who are the founders
Each of the founding partners brings a strong background in venture capital and successful investments. Goldberg previously invested in Plaid and Bridge, while Shen backed companies such as Sprig and Decagon. Kurzweil has notable investments in Twitch and PagerDuty. Their combined track record lends credibility to their strategy of providing more personalised attention to early-stage companies, a quality that larger funds sometimes struggle to offer consistently.
In an interview with Forbes, the team expressed their goal of delivering the expertise expected from a large VC firm while providing the level of attention that smaller funds are typically able to offer. By remaining actively involved in the trenches with their founders, the team aims to differentiate Chemistry in the crowded venture capital market.
What do we think about their approach?
US-based Chemistry enters the venture capital space with a clear focus on early-stage companies, seeking to combine the experience of its founding partners with a hands-on, concentrated investment approach. By focusing on two to three investments per year per partner, Chemistry aims to offer more personalised and involved support than larger venture firms.
The new firm also aims to help startups navigate an increasingly complex funding environment, particularly in the challenging Series A stage. With their debut fund fully secured and oversubscribed, the founding partners appear poised to make a significant impact on the early-stage investment landscape.
The firm’s focus on fintech, infrastructure, and developer tools aligns with sectors that have shown resilience and growth potential, especially in the face of ongoing challenges in the broader venture capital market. Through its emphasis on commitment and excellence, Chemistry’s approach could resonate with founders seeking not only financial backing but also deep engagement and expertise from their investors.
The post Chemistry VC launches $350M fund to support fintech and infrastructure startups, led by Bessemer, a16z, and Index alumni appeared first on Tech Funding News.