Foundry Group: Deciding Not to Raise Another Fund
Foundry Group, an established venture firm based in Boulder, Colorado, has made the surprising decision to shut down and forego raising additional funds, despite announcing a $500 million fund just last year.
Unexpected Move
The firm, which has been active in the venture capital scene since 2007 and manages nearly $3.5 billion in assets, revealed on January 19 that its current fund would be its last. This decision comes as a departure from its previous plans, especially after announcing the Foundry 2022 fund in May 2023.
Foundry’s Legacy
Foundry Group, led by co-founder and partner Seth Levine, has made significant investments in over 200 companies and nearly 50 venture firms over the years, backing notable names like Fitbit, Zynga, and AvidXchange.
Intentional Planning
Levine clarified that the decision to shut down was part of the firm’s original plan since its inception in 2006. Foundry intentionally avoided building a legacy firm meant to outlast its founding partners. Instead, it focused on investing and re-evaluating fundraising opportunities as needed.
Reflection and Decision-Making
Internal discussions led to the conclusion that the 2022 fund would be Foundry’s final one. Levine, in a personal blog, shared that he had been transparent about this plan since early 2023. The firm’s unconventional approach challenges norms in the venture industry and reflects its commitment to experimentation and innovation.
Continuing Operations
While Foundry won’t raise new funds, it still has a significant portion of its latest fund available for investment. The firm plans to focus on leading Series A and B financings. However, this decision may pose challenges for portfolio companies seeking follow-on funding.
Future Outlook
Foundry expects to fully deploy its remaining funds by around 2026 and intends to continue supporting existing portfolio companies thereafter. Co-founder Brad Feld, partner Chris Moody, and other team members plan to remain involved until their work is complete.
Industry Trends
Foundry’s decision echoes a recent trend in the venture capital landscape, with other firms like OpenView also unexpectedly announcing their winding down. While the reasons behind these decisions vary, they signal a shifting landscape within the VC community.
