Foundry Group, an 18-year-old enterprise agency with practically $3.5 billion in belongings underneath administration, has quietly determined to close down and never elevate any extra funds. The transfer was sudden contemplating that the agency introduced a $500 million fund final 12 months.
Boulder, Colorado-based Foundry first introduced that its present fund can be its final on January 19. The enterprise agency had been investing since 2007, based on Crunchbase, and had introduced the $500 million fund, Foundry 2022 — its eighth — in Could of 2023.
Through the years, Foundry has invested in additional than 200 firms and practically 50 enterprise corporations, based on co-founder and companion Seth Levine. It had backed the likes of Fitbit, Zynga and AvidXchange, amongst others.
When TechCrunch reached out to Levine, he declined to touch upon the agency’s determination to shutter, and as a substitute pointed to blogs he’d written. He did, nevertheless, affirm an unspecified variety of departures on the agency, though he didn’t make clear in the event that they had been layoffs or voluntary.
In a single blog, he acknowledged that the agency’s determination to fully shut down was an uncommon one.
He wrote: “While VC firms rarely make decisions like this, it’s precisely what we planned to do when we started Foundry in 2006. From our founding, we intentionally decided not to build a legacy or generational firm — one meant to live beyond the tenure of the founding partners. Instead, we intended to focus on the work of investing, re-evaluating each potential new fund as our fundraising cadence required…We’ve had several moments over the last decade where we thought the fund we were raising might be our last. Each of those times, after reflection and discussion, we decided to raise another fund. But not this time. Foundry 2022 will be our last fund.”
What’s subsequent
Foundry nonetheless has 33% to 40% disregarded of that fund to speculate, Levine informed the Denver Business Journal. In his weblog, Levine stated particularly the agency plans to “continue to lead Series A and B financings” out of the fund.
The transfer raises questions for its portfolio firms. Foundry says it would proceed to speculate out of its latest fund, however for founders, accepting capital from a agency that’s winding down is a threat and will make securing follow-on funding that a lot tougher.
In the meantime, Levine maintained to the Denver Business Journal that he expects all of the funds to be deployed by round 2026 and that the agency will then “still work with businesses in which it has investments.”
In his private blog, Levine wrote: “We raised our last Foundry fund at a fortuitous time, just as the markets cooled off (it’s a great time to be investing), and we have another two years or so of new investments to look forward to. Not to mention a decade or longer of work with the portfolio after that.”
The investor additionally informed the Denver Enterprise Journal that he would “be with Foundry until its work is completely done,” including that co-founder Brad Feld and companion Chris Moody “plan to do the same.” He couldn’t say what the opposite companions would “get up to in the next few years.”
In her personal blog post Foundry companion Jaclyn Hester wrote that she was “focused on supporting our portfolio and leading new early-stage rounds as we deploy the remainder of the 2022 fund over the next few years.”
Foundry isn’t the one enterprise agency to not too long ago unexpectedly shut down. In December, Boston-based OpenView abruptly announced it would stop investing in new companies lower than a 12 months after raising $570 million for its seventh fund.
