Introducing Velocity — TCV’s New Fund Targets Expansion-Stage Investments, Raises $460 Million
Menlo Park, New York, January 31, 2022 — We are delighted to start 2022 with the announcement of Velocity, a $460 million fund geared towards expansion-stage investment opportunities. After a momentous year in 2021 — resulting in 14 public listings, which include IPOs, direct listings, and SPAC transactions — TCV believes that Velocity will allow us to continue the firm’s history of partnering with leading companies from early investment rounds through IPO. We believe that Velocity is ideally placed to take advantage of a growing investment segment and will complement our parallel investment activity with ambitious tech companies at later stages of development.
Apply the insights of proven companies to ambitious growth companies
Velocity builds on our long history of success backing category leaders and is specifically designed to help founders of innovative companies as they shift from product-market fit to scaling up. With a dedicated team of investors, Velocity will draw on the resources and reach of the entire TCV platform to help ambitious expansion-stage companies achieve the next phase of growth.
TCV’s investment approach since day one has been our willingness to invest and reinvest through thick and thin, and across the company growth lifecycle, from early-stage funding to IPO and beyond. It also has been our steadfast belief that the strongest investment partners provide something far more valuable than assets alone. Since inception in 1995, TCV has backed category leaders across both B2B and B2C tech markets, executing 79 public listings and 69 M&As as of the end of 2021.
The firm has $28 billion of assets under management as of September 30, 2021. We believe our high profile and strong performance are due to our thematic approach (including fintech, education, prop-tech media/entertainment, e-commerce, healthcare, vertical SaaS, and DevOps security); our success in identifying future category leaders; our end-to-end operating support/rolled-up-sleeves approach; and our patient investment style. We work with entrepreneurs over the long term as their capital partner and believe that we can support them with acquisition capital as well as secondary funding to IPO anchoring, post-IPO support, and beyond.
The Velocity fund is already off to a promising start with several portfolio investments, including BenchSci, a global leader in machine learning applications for novel medicine development, and Passport, a modern international shipping carrier built for e-commerce DTC brands and marketplaces. Our aim is for a concentrated portfolio with access to the full TCV platform across investments of Series A, B, C, and beyond.
TCV Velocity features a dedicated team of investors and operators. It is headed by General Partners Matt Brennan and Gautam Gupta, who together bring a powerful blend of operating and investing experience. The Velocity investment team also includes three additional investors who have joined TCV in the past year from other leading venture growth firms.
Velocity investment themes
Although this list is by no means exhaustive, the Velocity team will be keeping a close eye on opportunities linked to the following high-growth sectors, which are already proven success themes for TCV:
- E-commerce enablement
- Tech disruption across health & wellness
- Democratization of financial services
- Acceleration of AI/ML adoption
- Supply chain digitization and optimization
Strategically timed for success
We believe the timing of our new Velocity fund has been well planned. With technology companies scaling faster and looking to expand earlier, we see what we believe to be a perfect opportunity to leverage our established platform to address the unique growth needs of younger/earlier-stage companies.
The Velocity fund intends to partner with TCV’s Growth funds to provide full lifecycle capital, generally from Series A through IPO. With Velocity, we’ll be taking our deep insights into what we believe makes a great company and applying them much earlier. TCV’s goal is to allow CEOs to think longer term and introduce them to TCV as a capital partner for the next decade, across all stages of their lifecycle, pre- and post-IPO.
A differentiated multi-stage investor
TCV’s “long view” and crossover approach, for which we are well known, is linked to our flexible approach that we intend, in turn, to tailor to the particular needs of each company and its early investors. TCV can lead or follow and has no minimum ownership requirements.
As well as investing across the lifecycle of a company, with both the Velocity fund and our Growth fund, our interests are no longer confined to a particular investment bracket: we generally write checks from $10M to $400M+. As such, TCV can support companies across a variety of requirements — from acquisition capital and secondary funding to IPO anchoring, post-IPO support, and beyond.
There are all kinds of new tech innovators out there that we believe are ideally placed to help; and in 2022, we look forward to joining them on their scale-up journey.
“TCV is using its vast experience of taking companies to IPO and beyond to help expansion-stage companies with equivalent ambitions. We’re enormously excited about the year ahead, as we formally bring to market this much anticipated new fund and engage with founders of companies that are rich with potential and aggressive ambition.”
- Matt Brennan, General Partner, TCV
“As our current portfolio CEOs will attest, we’re already active investors that partner with founders over the lifecycle of the company — from as early as a Series A all the way through an IPO and beyond. We have a 27-year track record of scaling what we believe to be iconic franchise companies (the likes of Airbnb, Alarm.com, EA, Netflix, Peloton, Spotify, and Zillow) and in many cases, we remain involved for the long term, seeing companies through multiple economic cycles.”
- Gautam Gupta, General Partner, TCV
“For more than a quarter of a century, TCV has invested in over 350 companies, including category leaders like Airbnb, EA, ExactTarget, Netflix, Spotify, Facebook, Alarm.com, Splunk, and Zillow. The experience of helping the founders of these companies scale their businesses into dominant public companies has given us the pattern recognition to help emerging companies earlier in their development cycle lay the foundation on the path to becoming future franchise names in the tech world. Our goal with the Velocity fund is to identify and support the next generation of category leaders on this journey.”
- Tim McAdam, General Partner, TCV
Originally published at https://www.tcv.com on January 31, 2022.