NEA spin-out NewView Capital raises $1.35B for its debut growth fund

Companies are staying private longer and longer, and New Enterprise Accompanied( NEA) has a new plan to combat the negative implications of the trend. The storied venture capital conglomerate has invested in a spin-out fund announced NewView Capital and sold 31 of its late-stage portfolio companies to the effort.

Former NEA general partner Ravi Viswanathan is leading the fund, which is currently announced a $1.35 billion pond of asset to invest in growth-stage business across industries and support the large cohort of onetime NEA investments now under its purview. Among the companies purchased by NewView from NEA are 23andMe, Acquia, Canopy, Duolingo, Forterand GumGum.

The secondary agreement allays some of the pressure on NEA to provide liquidity to the investors in its older funds, known as limited collaborators( LPs ), without encouraging its portfolio companies to exit before they’re ready. Purchaser genetics firm 23andMe, for example, was founded in 2006; NEA has been among its investors since 2007, per PitchBook. It normally takes between five and eight years for a VC-backed startup to be acquired or to prosecute an initial offering, stirring 12 -year-old 23 andMe long overdue for the purposes of an exit.

” There’s a lot of bottleneck on the road to liquidity ,” NEA administering general partner Scott Sandell said in the following statement.” Market dynamics are pressuring companies to stay private longer, which creates growing demand for follow-on dollars and elongates investor maintaining stages to a decade or more .”

Sandell has led NEA since the mid-1 990 s. Viswanathan assembled him in 2004 and has co-lead the firm’s rise equity speculation tradition for several years. He’s been focused on the NewView spin-out since the beginning of 2018.

” We are affording liquidity to a aim of companies that would require several years longer to get liquidity ,” Viswanathan told TechCrunch.” It’s a obstruction marketing that has never actually been done and it’s a highly curated basket … There have been GP restructurings in the past; that’s not this. There have also been lots of one-off obtains; that’s not what this is either. This is really a strategic spin-off of a curated initiate of firms done at proportion .”

NEA, founded in 1977, is well known for its investments in Snap, Jet and, most recently, The Wing, Opendoor and Casper. The multi-stage investor wrapped its 16 th expansion store in 2017 on $3.3 billion.

The firm has been clearing tactical moves over the last several years to manage changes in the VC market further exacerbate SoftBank’s nearly $ 100 billion Vision Fund. In 2015, for example, NEA fostered its first opportunity store in addition to a multi-billion flagship vehicle so it could fix follow-on investing in its buzziest companionships. Doing that threw it the flexibility to pay a little bit more for the swelling late-stage valuations some of its better speculations had made up. The firm was also one of the first to foster a “mega-fund,” or a money larger than$ 1 billion, in 2000.

Since then, funds have only become larger and companies more expensive. NEA’s latest decision to separate some of its investments may be especially wise as numerous are predicting an imminent turn in the undertaking market.

Joining Viswanathan at Burlingame-based NewView as operating spouses are Tim Connor, a former NEA executive-in-residence; and former SigFig premier commodity detective David Yoo. Prashant Gangwal, the director of commerce at SharesPost, attaches as prime financial officer and chief operating officer.

NewView’s LPs include Goldman Sachs and Hamilton Lane.

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