What is the background of Revolution?
Revolution is a Washington, D.C.-based venture capital fund founded by AOL co-founder Steve Case in 2005. The firm has two funds, Revolution Ventures, a $200M fund for early stage investments and Revolution Growth, a $450M fund for later stage investing. We focus on investing in technology-enabled companies that empower consumers and have the potential to disrupt multi-billion dollar industries. There are 15 investments in the Revolution Growth portfolio and 9 in the Revolution Ventures portfolio, and we hope to invest in a handful more in 2016. We take a team based approach to investing that allows us to concentrate our strategy and time on building successful companies.
What kind of deals are in your wheelhouse?
On the Growth fund we seek companies with a revenue run rate of $20M or greater. We look to fund consumer tech and SaaS-based businesses that are attacking large, traditional industries with innovative new products and services. Many existing industries are on the brink of disruptive change.
We’re flexible on ownership stake and deal structure. We take board seats in most of our deals. We want the right team, with the right product disrupting preexisting multi-billion dollar industries.
How do you handle syndication and how do you divide up the work?
We have done deals with a wide range of top-tier venture investors. Examples of this include venture deals with General Catalyst and private equity deals with Carlyle. With regards to the work, it comes down to filling in the gaps with our expertise. We have a focus on the four Ps -- partnerships, positioning, people, and policy. Partnerships are about helping them build key strategic partnerships on deals that will actually help move the needle. On people, it’s about recruiting top level executives and also recruiting exceptional, well-known board members. Presence is about gaining visibility in the marketplace for customers, partners, and investors. Policy is important if they are in a regulated environment.
What do you do to help the portfolio grow?
We help them get the next round of funding or go public. And help them across the life cycle with many different aspects of the business including strategy, marketing, product, and finance.
Do you have any portfolio companies in Texas?
We have two investments in Austin--Bigcommerce which we syndicated with Softbank, General Catalyst, and Floodgate. We’re also in Sparefoot with Floodgate, Silverton, and Insight Venture Partners. We would love to find more deals in Texas as the Rise of the Rest is a big part of our thesis, which is the idea that high-growth companies can now start and scale anywhere, not just in a few coastal cities.