Boldstart Ventures started off with $1 million in 2010 as a kind of experiment. Could a New York-based outfit find enough seed-stage, enterprise-focused, East Coast opportunities to rationalize a bigger fund?
The answer, seemingly, is yes. Boldstart, founded by longtime VC Ed Sim (who’d spent the previous decade-plus an investor with Dawntreader Ventures), just closed its third fund with $47 million.
That’s $30 million more than the $17 million Boldstart had raised for its second fund in 2013, says Sim, who now works alongside general partner Eliot Durbin. The two have also more recently brought in Work Market cofounder Jeff Leventhal as a venture partner.
It’s easy to appreciate the enthusiasm of the firm’s backers, which now includes as an anchor investor the fund of funds Top Tier Capital Partners. For one thing, six years into Boldstart’s adventure, there aren’t a lot of micro VC firms in New York that are primarily focused on regional enterprise companies, though Sims says there’s no shortage of interesting startups to fund.
Among Boldstart’s newest bets is Kustomer, a year-old, New York-based platform that enables brands to keep track of and increase engagement with their customers. (In September, the company revealed that it has now raised $12.5 million to date.) It also wrote one of the earliest checks to HYPR, a two-and-half-year-old, New York-based startup that helps companies deploy secure password-less experiences for their employees through fingerprint, voice, face and eye recognition. It announced $3 million in seed funding last month.
Indeed, while most seed-stage firms of the same age are still waiting on their first exits, Boldstart has seen six from that very first, very small fund, including the sale of Rapportive to LinkedIn in 2012; Divide’s sale to Google in 2014; GoInstant’s sale to Salesforce in 2012; and Blaze Software’s sale to Akamai in 2012.
Boldstart has another 29 startups in its second fund. None has exited yet, but many have raised substantial follow-on funding, including SecurityScorecard, a three-year-old, New York-based security startup that helps its customers predict and remediate potential security risks across their organizations and their partners. Earlier this year, it raised $20 million in Series B funding led by GV.
We talked with Sim yesterday about the new fund and about emerging shifts that Boldstart has identified. The biggest, he said, is the early adoption of cloud for enterprises. “We talk with a lot of buyers who used to use the cloud for either developer platforms or new projects but are now exploring how to move their legacy systems to the cloud. It’s still early, but there’s a groundswell building, which is opening up a ton of opportunities around how to better manage and secure data and how to help developers be more productive. ”
We also talked about that elusive $1 billion exit on which the New York startup scene is famously still waiting. Sim’s bet on which company will break that ceiling? MongoDB, the nine-year-old, open-source database technology company, which has long been valued at more than $1 billion by its private investors. “Everyone is hoping they do become that company,” Sims said.
Pictured above, left to right: Leventhal, Sim, and Durbin.