Venture capital giant IVP, a name synonymous with tech innovation since the 1980s, is doubling down on the future with its 18th fund. The $1.6 billion war chest targets high-growth companies with a specific focus on those leading the charge in artificial intelligence (AI). In the recent past, we have seen IVP investing $60M round in London fintech Volt as well.
Investing in proven winners
IVP has a long history of backing industry titans. Their portfolio boasts household names like Slack, Snap, and Netflix, companies that have redefined how we communicate, consume media, and work. Their investment philosophy centres on identifying companies with strong product-market fit, organic growth, and a capable leadership team, as summed up by General Partner Somesh Dash: “We invest in companies with product market fit, organic momentum and the right team.”
A shift in the market landscape
The VC acknowledges a changing landscape in the venture capital world. Gone are the free-flowing funds and sky-high valuations of recent years. IVP’s General Partners (GPs) view this as an opportune moment for companies with strong fundamentals. As overfunded startups struggle, those with a clear vision and efficient operations will be well-positioned to attract top talent and accelerate growth. “This isn’t a raucous, Roaring Twenties kind of time,” observes GP Steve Harrick. “This is a time to build prudently, create value and understand that building a business is a gradual and persistent process.”
Building for the long term
IVP emphasises a focus on long-term, sustainable growth. They advise founders to prioritise operational efficiency and attract talent through a compelling vision, rather than relying solely on hefty compensation packages. “The best founders are both very persistent and very resilient,” says Harrick. “Instead of saying, ‘We’re going to triple headcount,’ the best founders are saying, ‘We’re going to do more with less, and maybe we’ll hire five people if we really need them.’”
The importance of partnership
Finding the right venture capital partner is crucial for founders. IVP emphasises building genuine relationships with founders and acting as a sounding board, offering both support and, when necessary, constructive criticism.
“You don’t survive in this business for as long as we have if you’re not putting in the work to build relationships and support companies through good times and tough times,” says GP Eric Liaw. “When you take on an investor, you’re going to be seeing and working with that person for three, five, seven, sometimes 10 years. Think about how you’re going to build a company and who can help you do that.”
The future may be uncertain, but IVP is betting on the ingenuity and resilience of founders. While the public market recovery may be gradual, they believe high-quality companies with a strategic plan will be well-positioned to capitalise on upcoming IPO windows.
“If you look back at different decades, 90% of exits are usually concentrated in a few years,” observes GP Cack Wilhelm. “We might have some IPOs this year and it only takes a few high-quality companies to help reenergize the exit markets. Great CEOs should be ready for the next window.”
A legacy of innovation
The announcement comes alongside a tribute to Reid W. Dennis, IVP’s founder. His pioneering spirit lives on in the firm’s commitment to fostering the next generation of transformative technology leaders. IVP concludes by expressing their eagerness to partner with the companies that will define the future, echoing Tom Loverro’s sentiment: “We can’t wait to build with you on the road ahead.”
