ffVC kicks off first general solicitation from a venture fund
Since September 23, hordes of startups have begun advertising their plans to raise funds. On AngelList alone, more than 1000 companies have done so. Angel investors have started leading syndicates on the site. And venture funds themselves, including Betaworks and Foundry Group, have committed to investing in companies which engage in general solicitation on AngelList.
The lesser-known side of the new laws going into place is that venture funds themselves (and private equity funds, and hedge funds, ) can also generally solicit. So far none have to my knowledge. Today, a small New York firm is breaking the seal: ff Venture Capital has announced it will finish out the remaining month of fundraising for its next fund through general solicitation.
One of the biggest things making it so difficult for small venture funds to raise capital is the ban on general solicitation, wrote John Frankel, founding partner of the firm. From his blog:
The ban has long hindered funds and firms from letting anyone know that they are raising capital, and from sharing their historical performance, infrastructure, and capabilities. As a result, capital has flowed to players with brand and ego, based on tales around pretty much anything other than return on capital (or even return of capital).The firm is raising its third fund, FF Rose Venture Capital Fund, with a target of between $30 million and $50 million. It has been in the market with this vehicle for almost a year....MORE
