After many months, we’re delighted to announce the closing of our latest fund, Bee Partners II, which was oversubscribed at $30M+ after an initial target of $25M. Just like our Founders, we also have to raise funds from investors, and like them, we’re elated about the journey ahead now that our fundraising period is behind us.
This new fund, over 4x the size of Bee Partners I, is remarkably similar to a startup’s shift from a ‘pre-Seed’ round to a true Series A round. Our network of friends and family could no longer afford to keep our passion afloat, wherein Bee II we sought capital from outsider investors who demand results. Just like we as VC’s have chosen to invest in select startups from a sea of opportunities, so too have our LP’s made a choice in funding our latest fund. And just as our Founders have embraced investor expectations of milestone achievements and proper controls, so too have we matured into an established firm.
In spite of today’s announcement, we’ve been investing this fund since early 2014 — Bee II already includes 17 companies, nearly half of which have strong UC Berkeley ties. Check sizes start at around $400K per company, and go to approximately 8 new startups annually. These 17 investments showcase broad diversification, and over half have already benefited from follow-on capital within 12 months, including Neighborly ($5.5MM Series Seed, FinTech), Embroker ($12.2MM Series A, FinTech) , StatMuse ($10MM Series A, Artificial Intelligence), and BuildingConnected ($8.5MM Series A, Construction).
Traditionally, people think VCs fund ideas, but the reality is that the vast majority fund already proven business models. At Bee, we invest at the Pre-Seed because we aspire to go back to VC roots, when companies were funded before they had proven it out and/or found their product-market fit. It is the stage when we are most valuable to Founders, and now more than ever. As early round sizes grow and investors (finally) become more discrete about how many checks to write, Founders are actively seeking out lead investors at the Pre-Seed.
Founders can take solace in knowing that we have consistently embraced the lead investor since our inception in 2009. In fact, we’ve served as first investor in over 60% of our companies; most of our Founders are first-timers and 25% of the current portfolio had 0 revenue, 0 customers, and 0 product when we first invested. Put another way, we never pass because ‘you’re too early’.
While our focus remains intact for Bee II, we’ve raised a larger fund for several reasons. We are now able to extend the level of support we offer our Founders through subsidizing services as you ramp up your team. We also have more dry powder for later stage rounds when our companies start to take off, and we’ve expanded our team to its current size of 5 to provide additional weekly support to our Founders.
Since its founding in 2009, Bee Partners has consistently identified promising entrepreneurs with Deep Market Insights, and provided capital and mentorship at the earliest stages of venture creation. In our approach to Bee II, we remain eager to invest in enterprise and frontier-focused technologies, and thrilled to meet Founders who fearlessly pursue opportunities that will impact our future.