A Surprising Development from the San Francisco-Based Venture Capital Firm
In a recent filing with the U.S. Securities and Exchange Commission (SEC), Homebrew, a prominent venture capital firm based in San Francisco, announced its intention to raise $50 million for a new fund. This development comes as a surprise, considering that the firm’s general partners, Satya Patel and Hunter Walk, had expressed their commitment to an evergreen model just over two years ago.
The Evergreen Model: A Shift in Approach?
In 2022, Homebrew announced its decision to adopt an open-ended fund structure with no termination date. This approach was seen as a departure from the traditional venture capital model, where funds typically have a fixed lifespan and must be closed before new investments can be made.
The filing raises questions about whether this shift in approach has been successful or if Homebrew is now seeking additional resources to supplement its existing fund. A source close to the matter who wished to remain anonymous told TechCrunch that Homebrew has been using Special Purpose Vehicles (SPVs) to write pro-rata checks into certain follow-on investments, but is now seeking to raise a dedicated fund for this purpose.
A Proven Track Record of Success
Homebrew has established itself as a prominent player in the venture capital landscape since its inception in 2013. According to Crunchbase, the firm has made over 200 investments and has backed notable companies such as Winnie, Finix, Concentric AI, Mercury, and Plaid.
The firm’s portfolio companies have also seen significant success, with at least three dozen exits, including Cruise, Weave, and Cheddar. Most recently, Homebrew led a $12 million Series A round into Slang.ai, a platform that automatically answers the phone for restaurants, retailers, and other types of brick-and-mortar businesses.
The Decision to Raise a New Fund
When asked about the new filing, Hunter Walk declined to comment publicly, citing the firm’s desire not to disclose its plans at this time. However, it is clear that Homebrew is seeking additional resources to support its investment activities.
Raising a new fund may provide Homebrew with the flexibility to pursue opportunities that are not possible within the existing fund structure. With an evergreen model in place, the firm can now focus on making strategic investments without being limited by a fixed fund size or termination date.
The Ever-Changing Landscape of Venture Capital
The decision by Homebrew to raise a new fund highlights the evolving nature of venture capital investing. Firms are constantly adapting their strategies to stay competitive and capitalize on emerging trends.
While some firms have successfully transitioned to evergreen models, others may still require traditional funds with defined lifespans. The landscape is complex, and investors must be agile to respond to changing market conditions.
A New Era for Homebrew
The announcement of a new fund by Homebrew marks an important milestone in the firm’s evolution. As the venture capital landscape continues to shift, it will be interesting to see how the firm adapts its strategy to meet the changing needs of startups and investors alike.
One thing is clear: with over 200 investments under its belt and a proven track record of success, Homebrew remains a significant player in the world of venture capital. The decision to raise a new fund demonstrates the firm’s commitment to supporting innovative companies and contributing to the growth of the startup ecosystem.
The Full List of Homebrew’s Portfolio Companies
Here are some of the notable companies that have received investment from Homebrew:
- Winnie
- Finix
- Concentric AI
- Mercury
- Plaid
- Cruise
- Weave
- Cheddar
- Slang.ai
This is not an exhaustive list, but it gives a sense of the diversity and scope of Homebrew’s investments.
Homebrew’s Track Record of Success
Since its inception in 2013, Homebrew has established itself as a prominent player in the venture capital landscape. With over 200 investments under its belt, the firm has demonstrated its ability to identify and support innovative companies.
The success of Homebrew’s portfolio companies is a testament to the firm’s expertise and investment strategy. From seed-stage investing to follow-on investments, Homebrew has shown that it can adapt to changing market conditions and capitalize on emerging trends.
Conclusion
Homebrew’s decision to raise a new fund marks an important development in the world of venture capital. The firm’s commitment to its evergreen model highlights the evolving nature of investing and the need for firms to be agile in response to changing market conditions.
As Homebrew continues to grow and evolve, it will be interesting to see how the firm adapts its strategy to meet the needs of startups and investors alike. With a proven track record of success and a focus on supporting innovative companies, Homebrew remains a significant player in the world of venture capital.
