May 25, 2022

It took some time to build up $5 billion in assets under management. Not so with Lead Edge Capital, a 12-year-old investment firm based in California and New York, which just surpassed that number and received its sixth and final staggering $1.95 billion in capital commitments from nearly 500 investors. was closed.

The pool follows a $950 million fund that Lead Edge closed in October 2020 – also about 500 investors – which boosted the company’s assets to $3 billion at the time. (According to company founder Michelle Green, Lead Edge manages a $150 million “public” fund it created last year on behalf of its investors.)

Even at a time when money is flowing freely to tech investors — as noted on Monday, venture capital firms manage more money than outsiders — the amount is astonishing.

The company attributes this in part to its recent exits, including leaving fashion medical apparel retailer Figs, which went public last May; A direct mention of Asana, a software company that develops workplace collaboration software, in September last year; The very successful IPO of dating service Bumble last February; and the sale of security firm Signal Sciences to the public company Fastly in October 2020 for $775 million in cash and stock. (Signal Sciences has raised about $60 million from investors, according to Crunchbase.)

Previous earnings came from Alibaba’s IPO, Spotify’s IPO, and the sale of Duo Security to Cisco, with leading companies betting big. Green said the company invested $300 million in Alibaba years before the IPO; over $150 million in Spotify in the years leading up to its IPO; and over $90 million in Duo.

Big stakes are not uncommon for Lead Edge, which is proud of the investments it has made over a long period of time. “In the private world, we would be running a fund with about 20 investments,” Mitchell told us during a podcast interview in January. When it comes to publicly traded companies that Lead Edge backs its publicly traded venture funds, occasional special purpose vehicles and up to 25% of its core funds, the team takes an even more subtle approach. “You should think about our public fund, which we want to take from 5 to 10 positions. We’re focusing on that.”

All these investments are not going according to plan. While Lead Edge has donated $160 million over the years to its Alibaba subsidiary Ant Group, which is expected to be the world’s largest IPO in the fall of 2020, the offer was completely thwarted by the Chinese securities regulator. ever ended.

Green says he is not concerned that Lead Edge has not sold shares and is not interested in selling its shares.

Instead, he told us in January that he sees startups in China as a huge buying opportunity as he has been heavily influenced by China’s moves in technology.

At the time, he said he bought secondary shares in TikTok parent company ByteDance from previous lenders and invested more money in Alibaba, which is “ridiculously cheap” at the moment. (At the time of our conversation, Alibaba shares were trading at $113 a share, two months after the company’s IPO in 2010; they were trading at the same price as in November 2020, when Ant Group’s $37 billion IPO was launched in China. (Days before this IPO. They were trading at $310 a share.)

Clearly, such arms smuggling is attracting many Lead Age supporters, including former Xerox CEO Ann Mulcahy, former Charles Schwab CEO David Potruk, and former ESPN CEO Steve Bornstein.

Even the editor’s roommate revealed on a recent podcast that Greene manages some of his money and is happy with his profits.

As Green’s WSJ Bill Grub, a former General Atlantic executive, said in 2017, “It’s energy, isn’t it? I have never met a person who speaks so quickly and clearly.” He “made me a lot of money.”

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