Today, we’re excited to announce that we have closed our second fund - totaling $100 million - to help us democratize access to venture funding through the power of data science. This new fund is a major validation of our founding thesis that data is eating venture capital (apologies and credit to our friend and LP Marc Andreessen for the paraphrase in spirit).
When we started Rocketship in 2015, it was with the idea that data science and machine learning would play a major role in the future of venture investing - similar to the way it has disrupted retail, finance, healthcare, and other industries. In the years since we have seen the globalization of entrepreneurship as mobile-first (and mobile-only) regions like Asia, Southeast Asia, Latin America, and Europe build thriving startup communities.
The past six months have seen major developments in healthcare, public policy and social justice that have only accelerated the startup globalization trend. COVID-19 has changed the way venture firms are engaging with startups, with pitches over Zoom and term negotiation over WeChat. Stricter immigration policies for tech workers and students are convincing aspiring founders that starting in-country makes sense regardless of -COVID. In parallel, the fight for social justice and a renewed focus on racial and gender diversity in technology and venture capital highlights the need for a new, unbiased approach to identifying investments.
All of this reaffirms our belief that for a Silicon Valley firm to meet the investment opportunities this new global founder community presents, we need to rely on more than our network to find the most promising startups. Using the same data science principles our founding team used at Amazon, Walmart Labs, Kosmix and NASA, we’ve built highly vetted models that help us identify new and exciting companies from Silicon Valley to Singapore, Stockholm to Shanghai, and Brazil to Bangalore. This is something we could never have done relying on the traditional VC model of “network + inbound deal flow,” as it would require years of network and office building around the globe.
We believe that by following the data we can remove much of the unconscious gender, race, stage, industry, and geographic bias that influences the investment choices of even the most well-meaning investor. Will it be perfect? No, not as long as you have people building the models and influencing the data. But we theorize that it will help us make big strides in a more equitable and democratized approach to funding the best and brightest teams and their companies.
We’re excited for the second chapter in Rocketship’s story about what the future of venture capital looks like. Together with our amazing founders and LPs, we aspire to make a major impact on democratizing venture capital for the global startup community. In the meantime, we don’t need our data to tell us to have a conversation, so if you’re a startup founder interested in partnering with a firm that understands how to build data-driven companies, or a co-investor interested in finding out more about how we can partner, please reach out.