CircleUp Announces CircleUp Growth Partners, a New $125 Million Fund
New Fund Uses Data and Machine Learning to Invest in Early-Stage Consumer Brands
Oct 31, 2017, 10:00 ET
SAN FRANCISCO, Oct. 31, 2017 /PRNewswire/ -- Today, CircleUp announced CircleUp Growth Partners, a $125 million venture fund power by technology which invests in innovative, early-stage consumer and retail companies. The fund closed at its hard cap and was oversubscribed.
CircleUp Growth Partners is a new kind of investment fund with a data-driven, scalable approach to investing. It leverages CircleUp's machine learning platform Helio through each step of the investment process; from deal sourcing, to investment decisions, to post-close company support. Helio proactively collects and analyzes billions of data points across more than 1.2 million companies to understand and predict their future success. It collapses the traditional diligence process, enabling CircleUp Growth Partners to efficiently find and evaluate more investment opportunities than could ever be evaluated manually, while also helping drive value to the companies after close.
Traditional early-stage investing tends to be time-consuming, entirely manual and riddled with human bias. CircleUp Growth Partners will push the sector to a quantitative, scalable business model by taking a technology-driven approach to investing. This approach aims to improve fund performance with better conviction, efficient diligencing and execution, and broad diversification, while limiting the bias so companies are evaluated on their true merit and potential—not just what investors might "feel" about them.
"While investing gets credit for accelerating innovation with capital, the VC industry itself has been resistant to adopt new technologies, operating more or less the same way it did 40 years ago," said Ryan Caldbeck, CEO and co-founder of CircleUp. "The scalability and conviction that Helio provides introduces a different kind of investment model. Typically, investing is constrained by the high operating costs and biases inherent to manual sourcing, evaluation and support of companies. CircleUp Growth Partners uses data science at the core of all three stages of the process, defining a new model with broad applicability to the future of private investing. Over time, we believe Helio will be a public tool used by other innovative firms in the consumer world, as we partner with great investors to improve the ecosystem overall."
CircleUp has brought on a premiere group of investors in the fund, all of whom believe strongly in CircleUp's quantitative approach to investing and the vast potential of the early-stage consumer asset class. The fund's Limited Partners include a diverse set of leading institutional investors and consumer industry veterans, such as Temasek, Euclidean Capital, outsourced CIOs, Annie's Homegrown cofounder John Foraker, former Blackrock executive of Scientific Active Equity Ken Kroner, Plum Organics founder Gigi Lee Chang, and Deva and Tevya Finger, cofounders of Luxury Brand Partners, the beauty incubator behind Oribe, Becca Cosmetics and more.
The first investments out of CircleUp Growth Partners are beauty supplements brand HUM Nutrition, which is leading the emerging ingestible beauty category, and 4505 Chicharrones, which is leading a new category that plays on trends of high protein, salty snacks. CircleUp Growth Partners is able to both lead rounds and participate in existing rounds. The team sees a strong opportunity to co-invest alongside other investors that bring unique, complementary expertise, to the benefit of the entrepreneur.
"In consumer private equity, investors very rarely co-invest. It has traditionally been a very insular and opaque culture, which benefits investors, but comes at a cost to the entrepreneur. Where appropriate, CircleUp Growth Partners will seek out partnerships with value-added investors to help companies thrive, and foster a more active and collaborative private market, aligned with the thesis of our marketplace," added CircleUp CEO and cofounder Ryan Caldbeck.
The announcement of CircleUp Growth Partners follows several expansions of CircleUp's offering, including its recently-launched Credit division and the continued growth of its marketplace of institutional investors, all of which are powered by Helio. To learn more about CircleUp Growth Partners, please visit: www.circleup.com/growth-partners
About CircleUp
CircleUp is the investment platform providing capital and resources to innovative, early-stage consumer brands. CircleUp is comprised of internally-managed funds, an investment marketplace and a credit division. All of CircleUp's business units are powered by Helio, its machine learning platform that evaluates 1.2 million businesses to predict future business success. Founded in 2012, CircleUp is backed by Union Square Ventures, GV, Canaan Partners, QED Advisors, and former leaders of Goldman Sachs, Capital One and Stanford Endowment. Learn more at www.circleup.com.
SOURCE CircleUp