This is a bigger deal than just the arrival of a new VC fund. It is, as far as I know, the first VC fund run by hackers.
Almost all existing VC funds are run by business/finance guys. I know a total of two VC partners who write code. And one of the two only made partner last summer.
Are there many funds that invest $100,000 - $500,000? From the people I've talked to, that seems to be one of the hardest amounts to raise. Too big for angels, too small for VCs. Matt Maroon has some good stories about this.
Some big funds are willing to invest small amounts. Sequoia will, for example. But the big funds can't do too many deals like that, or it breaks their model.
Would you not consider YC to be a venture capitalist ? Or do you characterize it as an angel operation ?
From the homepage "Y Combinator is a new kind of venture firm specializing in funding early stage startups. We help startups through what is for many the hardest step, from idea to company."
Firm != fund. A fund invests other people's money, in return for management fees and a percentage of the net return. Though of course the partners can have some of their own money in the fund.
We're financially more like angels, but systematic like a fund.
Hm. Not sure about VCs investing other peoples money. Some companies I work for that definitely position themselves as VCs have all the money brought in by the partners in the company.
I think an angel is a person, just the one guy/girl doing the investment, a VC is a fund that has multiple sources, possibly outsiders but also in some cases the partners themselves. Some funds are simply more 'open' to outsider investors.
It depends upon their investment model. The Angels Forum will create a syndicate and a lead angel for each investment and negotiate for a board seat for the lead.
Hm... $500k per deal still sounds more like angel investment than VC. Although, Tumblr's series A was 750k. This has been an ongoing trend but it looks like the boundaries between the size of angel and VC investment is beginning to blur as startups become scrapppier and stop looking for too much outside investment.
I wonder if this means it's going to become easier to raise money.
Almost all existing VC funds are run by business/finance guys. I know a total of two VC partners who write code. And one of the two only made partner last summer.