Bill Gates, Michael Dell Back $250 Million Village Global Fund

(Bloomberg) -- Dell Technologies Inc.'s Michael Dell, former Google CEO Eric Schmidt and Microsoft Corp. co-founder Bill Gates are among the tech billionaires backing venture firm Village Global's newest fund.

LinkedIn founder Reid Hoffman, who stepped back as general partner of Greylock Partners this year, also joined the San Francisco-based seed-investing firm as chairman. 

“The magic of Silicon Valley has always been about the power of a network,” Hoffman said in a statement. “Village Global is simply one of the best networks in tech — a network that helps early stage founders build massive companies.”

Other billionaire backers of Village Global include Meta Platforms Inc.'s Mark Zuckerberg, Amazon.com Inc. founder Jeff Bezos and Zoom Video Communications founder Eric Yuan.

The nexus of high-net-worth individuals and tech CEOs is unique to Village Global, which raised the majority of its latest $250 million fund from its well-known backers. It also has additional institutional support from multifamilly offices, university endowments at Princeton and Vanderbilt, as well as sovereign wealth funds, including Saudi Arabia's venture fund Sanabil Investments. 

Every year, the firm holds an event called The Grove for leaders of billion-dollar companies and Village Global's investors. 23andMe co-founder Anne Wojcicki co-hosts a special women-only gathering at The Grove as well. This year's will convene in mid-November in the Bay Area.

Beyond being a reflection of Hoffman's interest in relationships as founder of LinkedIn, The Grove also gives Village Global a leg up in investing, said Coda CEO Shishir Mehrotra, who previously attended the conference as a guest before becoming a backer in the newest fund.

Reid “takes relationships really seriously and the team has taken the ethos of that and really brought it to life,” Mehrotra said. “And of course it puts them in a position to be really good financiers as well as they get to see deals that other people miss.” 

Seed Stage

While The Grove focuses on late-stage companies, Village Global's investing starts at the seed stage with the hopes that its portfolio of 300 startups will one day make the invite list as billion-dollar businesses. Several of its portfolio companies, such as fintech Addi or AI contract-management tool Evisort, have raised Series B and Series C rounds, though the six-year-old firm has yet to have many notable exits.

The $250 million raised in Village Global's third fund will primarily back seed-stage startups with some money to support other emerging fund managers. The company currently has 13 employees and is co-led by Ben Casnocha, co-author of two books with Hoffman, and Anne Dwane, the former CEO of scholarship network Zinch.

Village Global doesn't specialize in any particular subject areas, but instead relies on relationships built by its network since its first $100 million fund debuted in 2017. It currently has more than $500 million of assets under management. 

“One of the ways we broke out was the association with those luminary LPs,” said Dwane, a partner at Village Global. “That started a flywheel that helped us attract some of the best angels and emerging fund managers, who in turn were able to discover and back some of the most exciting founders, who in turn were compelling investments in follow-on rounds for those LPs.” 

Bezos invested in the 2020 Series A funding round of Pave, a compensation-data platform. Schmidt also backed the 2022 Series B funding round of Sardine AI, a fraud-compensation tool. The firm has also financed several heath-tech and fintech startups because of its ties to Wojcicki and Fidelity CEO Abby Johnson, another limited partner in the fund. 

With Hoffman as chairman, Village Global could push deeper into artificial intelligence deals, but Casnocha cautioned that the firm wouldn't get caught up in the valuation frenzy. Overall, money raised for AI companies has surpassed funding totals for every other category in tech, but deal count for startups is still down 31% year-over-year, according to data from PitchBook prepared for Bloomberg. 

“A larger fund will allow us to write larger checks,” Casnocha said, “while also still being fundamentally collaborative with other venture firms.”

More stories like this are available on bloomberg.com

©2023 Bloomberg L.P.