Brian Singerman’s New Fund Has A Twist, And Peter Thiel As A Big Backer

Former Founders Fund GP Brian Singerman and co-founder and managing partner of Quiet Capital, Lee Linden, are seeking complete $500 cardinal for a caller money called GPx, 3 group acquainted pinch their strategy told TechCrunch. A important information of GPx’s fund, perchance arsenic overmuch arsenic 50%, will travel from Founders Fund co-founder Peter Thiel, these group said.

GPx uses a two-pronged strategy. The patient will put astir 20% of nan superior into costs managed by emerging VCs who are targeting pre-seed and seed-stage startups; nan remaining superior will spell toward partnering pinch emerging managers connected starring later-stage investments (most apt astatine Series B) of their breakout companies. 

It’s a reasonably different attack compared pinch really astir task firms operate. While emblematic VC firms put each of their superior straight into startups, GPx is adopting elements of what’s known arsenic a fund-of-funds model, a little communal finance strategy wherever a patient invests immoderate information of its superior into a portfolio of different funds, alternatively than straight successful underlying assets, specified arsenic startups. While a fund-of-funds offers constricted partners a convenient measurement to entree under-the-radar aliases hard-to-access firms, a important drawback is nan dual furniture of fees: those charged by nan fund-of-funds and those by nan underlying managers.

While superior raised by fund-of-funds firms deed a 16-year debased past year, according to PitchBook, Singerman and Linden are betting that their individual brands, unsocial networks, and a strategy that’s only partially a fund-of-funds will promote constricted partners to unfastened their checkbooks for GPx.

Singerman and Linden whitethorn beryllium connected to something. As task superior concentrates successful nan largest funds, immoderate of those firms’ champion investors are nary longer willing successful being a portion of a large machine. They are leaving nan behemoth firms to motorboat their ain investing outfits wherever they tin beryllium much nimble and specialized.

GPx is betting that nan adjacent procreation of VC investors will place and backmost galore beardown early-stage companies, allowing Singerman and Linden’s patient to co-lead later-stage investments successful nan emerging managers’ astir successful portfolio companies.

Here’s wherever GPx’s strategy becomes peculiarly valuable: early-stage VCs often effort to workout pro-rata authorities successful later backing rounds (Series A, B, and beyond), but their money sizes typically forestall them from maintaining their percent ownership successful top-performing companies. When faced pinch specified opportunities, mini VCs often scramble to raise typical intent vehicles (SPVs) from their existing constricted partners. Yet, these processes are time-consuming, allowing different investors to threat up coveted equity spots successful nan astir sought-after deals.

With GPx’s superior down them, emerging costs will person an opportunity to not only workout their pro-rata authorities but besides lead a later-stage round.

The Information previously reported that Singerman and Linden are launching GPx, but didn’t supply specifications astir nan fund’s target size and different strategy details.

Singerman and Linden didn’t respond to a petition for comment.