The firm’s ability to raise a larger fund is credited to its history of high cash distributions, returning $1.4 billion to its LPs over the past three years, which is over three times the amount requested from investors. Despite sticking to its early-stage strategy, Foundation Capital acknowledges the need for a larger fund due to the increasing size of seed and Series A deals, aiming to maintain a 15% to 20% ownership in each company. The firm has undergone a leadership change with the retirement of Charles Moldow, leaving four general partners.
Key takeaways:
- Foundation Capital raised a $600 million eleventh flagship fund, which is 20% larger than its previous $500 million fund.
- The firm focuses on seed stage investing, staying away from multi-stage, multi-geography, and multi-strategy approaches.
- Foundation Capital has been the first institutional investor in over 70% of its portfolio companies, including Cerebras and Solana.
- The firm has returned approximately $1.4 billion to its LPs over the last three years, more than three times what it requested from investors during that period.