By the time Alex Theuma had run several years of his annual software startup conference, SaaStock, speakers and investors began encouraging him to launch an investment fund.
“I thought it would be a distraction back then,” he says. Not now.
Today Theuma is announcing a first close, at $3m, of a target $10m fund. His VC firm, Backfuture Ventures, will invest in early-stage SaaS companies, primarily in Europe — and offer them access to SaaStock’s big network.
“It has, unsurprisingly, been hard,” he tells Sifted; the market downturn hasn’t made it easy for emerging VCs to raise. But he now has 48 LPs onboard, primarily founders, and six startups in the portfolio — and is hoping to do a final close by September.
The strategy
Backfuture will write £100k-200k cheques into pre-seed and seed-stage SaaS companies. It won’t lead deals — and will likely sit out many AI deals. (“At the moment, they’re far too expensive.”)
Around 70% of its portfolio will be based in Europe, 20% in the US and 10% in the rest of the world. “If we see a great opportunity, we don’t want to be restricted,” says Theuma, who adds that founders seem to like that he is himself an entrepreneur, with the fund only having lost out on two deals so far: “I’ve gone through what they’re going through.”
“The least interesting thing about us is the money,” he says. “It’s a strategic play for the founders. No other VC has access to a community and network [like SaaStock]; through it, we can provide access to VCs and experienced founders.”
Its six investments include: London-based Happl, an employee benefits platform (and Y Combinator alumni); Dublin-based Tipple, a platform that helps alcohol brands sell directly to consumers; and New York-based Prospect, a platform which helps people figure out which startup to join based on the potential equity upside.
Theuma is currently working on the fund part-time — something he says several LPs have questioned — although his associate, Kenneth Kashif Thomas (who he met at a SaaStock event), is full-time. By fund two, he says he hopes to be full-time on Backfuture.
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Approaching LPs
When he began fundraising, Theuma was inspired by an episode of Harry Stebbings’ podcast 20 Minute VC to take LP cheques of whatever size he could get.
“The advice was to not have a minimum cheque size to help get the ball rolling,” he says.
At first, Theuma said he’d take nothing below £10k — and found that five founders and operators came in as LPs at that mark.
He then lifted it to £50k, and later to £150k minimum — and found that “people typically come in at the minimum”.
To avoid having an enormous pool of LPs, he plans to raise it again nearer final close. “I’m trying to keep this well under 100 LPs if I can,” he says.
So far, Theuma — part of a growing community of solo GPs in Europe — has spoken to around 200 LPs and has 48 committed. They include: Phil Chambers, cofounder of HR platform Peakon; Bridget Harris, CEO of bookings software Youcanbookme; Taeh Hea Nahm and Ryan Floyd, managing partners at San Francisco-based B2B VC Storm Ventures; Christian Reber, founder of presentation software startup Pitch; and Gregory Galant, CEO of PR platform Muckrack.
Read the orginal article: https://sifted.eu/articles/backfuture-solo-gp-fund-news/
