Revolution Growth today announced its new $525 million “Revolution Growth III” investment fund. Led by proven entrepreneurs, business builders and investors Steve Case, Donn Davis and Ted Leonsis, the new fund will build upon the efforts of the previous Revolution Growth fund of $450 million, launched in 2011. The new fund will invest “speed-up” capital in businesses outside of Silicon Valley that are leveraging technology and new models to disrupt existing, multi-billion dollar industries.
Revolution Growth III will be highly selective, echoing past Growth funds, which have made just three to four investments a year, typically investing $25-50 million in each situation. This concentrated approach enables the firm’s partners to actively assist the companies they back, which are taking on some of the economy’s largest sectors including health care, education, transportation, energy, financial services, food and government services. This includes companies like Revolution Foods, Bedrock Manufacturing (Shinola and Filson), Optoro, CustomInk, Handy and sweetgreen, all investments from the previous Revolution Growth fund.
Revolution intends to keep its commitment to invest in companies located in “Rise of the Rest” regions – meaning that the vast majority of Revolution Growth III’s capital is expected to be invested in companies located outside of Silicon Valley. Revolution also believes that the most successful companies in the next wave will be those that understand the importance of forming partnerships with outside organizations and those that have a fluent grasp of the policy issues they will encounter. The investment team will look to find and invest in companies that understand the importance of place, partnerships, and policy.
“Revolution Growth was created out of a belief that with the right idea, team, and partners, there is significant opportunity to build innovative, built-to-last companies not just in Silicon Valley but all across the country,” said Steve Case. “While the investment pace has recently slowed somewhat in Silicon Valley, we believe the pace is poised to accelerate in Rise of the Rest regions. We look forward to joining forces with the next generation of entrepreneurs looking to transform significant aspects of our lives, and build great companies in the process.”
“There is something inherently American about coming up with an idea, pulling together a team and raising capital to go out and start a company,” said Ted Leonsis. “Business building is not easy, but Revolution has the expertise to help entrepreneurs execute on their ideas.”
“Our approach is not about a lot of companies or a portfolio theory,” said Donn Davis. “It is about taking a handful of companies and doing whatever we can to help make them iconic.”
The $525 million fund exceeds Revolution Growth III’s previous $450 million target. With this new Revolution Growth fund, plus its previous Revolution Ventures fund, the Revolution Funds now exceed $1.1 billion in committed capital. Revolution Growth will continue to focus on investing $25-50 million in speed-up situations while Revolution Ventures will continue to invest $5-10 million in promising startups.
The new fund is announced in conjunction with a significant expansion of the Revolution Growth investment team. In January, Steve Murray, a 20-year venture capital veteran at Softbank, joined as a partner, and two previous investment team members, Scott Hilleboe, and Evan Morgan, were promoted to partner. Vice presidents Kristin Gunther, Ashley Larson and Chris Hughes also joined the firm in the fall of 2015, joining associate Patrick Conroy.
The addition of these new partners and team members give Revolution Growth additional perspective and expertise on this next phase of investing and business building. The firm takes a collaborative, hands-on approach when working with its portfolio companies, bringing a unique collection of skills, talents and personal commitment to partnering with entrepreneurs to help build their businesses. Revolution believes that the value it provides will be increasingly important as the “Third Wave” of the Internet accelerates, and partnerships and policy become more important.
About Revolution Growth
Revolution Growth invests in companies that can change the world. Its mission is to build disruptive, innovative businesses that offer consumers more choice, convenience, and control in their lives. By taking a long-term approach and developing strong partnerships with entrepreneurs and management teams, Revolution Growth brings a unique strategy and passion to investing in and building significant companies.
For more information, visit www.revolution.com/growth.
