By: Rick Zullo & Richard Kerby
We are thrilled to announce the launch of Equal Ventures and our first fund, Equal Ventures Fund I, a $56M seed-stage venture fund designed to bridge the digital divide.
The Beginning of a New (Golden) Age…
We are living in perplexing times. At the dawn of a new decade, we’re witnessing political, societal and economic polarity, unlike anything that we’ve seen in recent years. Technology, once heralded as a force to “make the world a better place”, is now being vilified across circles of politicians and the populous. A contentious divide has developed between technology hubs and the rest of society as we increasingly lay witness to a world of technology “have” and “have-nots”, what some refer to as the “digital divide”. With that, we are seeing virtually every category (and the incumbents entrenched within those categories) attacked by an onslaught of digital upstarts, creating unprecedented amounts of both transformation and displacement.
While this may appear threatening, we firmly believe this places us at a critical junction in the innovation cycle where decades of technology installation can enable founders to deploy technology to solve some of the most impactful issues facing society and industry. Innovation cycles have consistently followed this pattern for the last several centuries and the movement from “technology installation” to “technology deployment” has historically resulted in the greatest periods of economic and social prosperity in modern history, something that economist Carlota Perez likes to call a “Golden Age”. We built Equal to be the firm at the forefront of this movement and the preeminent ally to founders bridging the digital divide.
What is Equal?
Equal is a thesis-driven fund that seeks to identify, evaluate and transform the leading challenges facing society and industry. Our approach is rooted in focus, choosing to perform exhaustive research into a few select topics that are demonstrating cataclysmic change that we believe creates the opportunity for multiple, multi-billion-dollar outcomes (we’ll discuss these in subsequent posts) and to develop authentic relationships with the business leaders capable of moving the needle in those circles. We believe that “fortune favors the prepared mind” and that domain expertise is critical in developing conviction in businesses prior to traction. We favor the complex and believe that our approach enables a deeper appreciation for nuanced approaches and to better identify founder-market fit unique to that sector. We invest in what we know and independent conviction is at the very core of how we operate.
In terms of stage, our firm focuses exclusively on seed. Our check sizes are sizable with respect to our fund size (generally ~$1.5m for first investment) since we firmly believe that conviction favors concentration over diversification. This level of concentration enables us to be extremely hands-on with our founders, working with them as members of a chosen family. Lastly, we’ve kept (and will keep) our fund reasonably sized so that we can maintain alignment with our founders throughout the lifecycle of their company as the investors closest to them on the cap table.
To further amplify our impact, we’ve brought on an incredible group of advisors and LPs that we feel best enables us to bridge the digital divide. While the majority of our capital comes from endowments, foundations and fund-of-funds, we are also fortunate to have leading executives from the industries we focus on, as well as leading operators and investors from the technology world. These resources are committed to mentoring our companies and we believe the nexus of these worlds creates a unique alchemy for our community.
When we began our venture careers, it seemed that the landscape had become a well-oiled machine, rooted in pattern recognition. The best returns had come from a small subset of technology hubs, the founders fit a certain profile and the playbooks developed to elevate the success of those companies generally revolved around recruiting engineers or making customer introductions to friendly CTOs and CIOs.
It’s clear that the surface area of entrepreneurship is growing and evolving. Founders, businesses, geographies and playbooks that hadn’t fit in the prototypical definition of what a startup “should” look like, are achieving great success.
We recognize that working with founders focused on transforming society and industry is fundamentally different than those developing apps, IT infrastructure or software selling to CIO/CTOs. It requires an openness to explore areas others won’t. It requires the willingness and patience to learn the nuances and complexities of industries prior to investing. It requires respect for these industries to recognize the need for personalized service, expertise and advice specific to that industry. We felt these founders were underserved, especially at the seed stage where they need help the most and that our backgrounds uniquely positioned us to address this challenge.
For those who don’t know, neither of us are technical by trade. Richard started off as an industrials investment banker and Rick spent the first five years of his career doing strategy consulting for clients in energy, government, financial services, agriculture, transportation and international development. As we made our ways from those worlds to the world of early-stage venture, we retained a core appreciation for the analog world outside Silicon Valley.
Rick migrated from consulting to private equity, went to Columbia Business School where he worked for several venture firms before joining Lightbank, a $200m early-stage fund based in Chicago. Richard went on to work for two of the most storied and long-standing venture firms in the world, IVP and Venrock, originally on the west coast and then in NYC.
Our firm identity is a reflection of the best practices and lessons learned from the many asset classes, industries and geographies we’ve worked across. We’ve designed Equal with a different set of principles and workflows than most, attributing elements of our styles to the principles of value investing just as much as to the traditional best practices of venture investing. We’ve augmented ourselves with exceptional professionals that expand our capabilities, further enhance our cognitive diversity and help us eliminate bias in our decision making and are continuing to hire aspiring professionals looking to solve some of society and industry’s greatest challenges.
While we live in perplexing times, we couldn’t be more excited about the future ahead.
We are fortunate to have already backed several companies across retail, logistics, insurance/benefits and the care economy, and we are excited to support more founders that are impacting society and industry. These initial founders feel like family to us, many betting on us just as much as we were betting on them, and we’re extremely pleased with the portfolio we’ve assembled to-date.
Additionally, we’re humbled to have a truly astonishing group of industry-leading founders, operators and VCs back us as LPs in this fund. These individuals have served as advisors, mentors and peers throughout our careers and we’re incredibly honored to have them as proud ambassadors of Equal.
There are so many others to thank for their support along the way, including the teams at Lightbank, Venrock, IVP for training us as investors, our peers in the VC community for supporting us through the process and serving as valuable co-investors, our former portfolio companies for enabling us to be a small part of their success, our LPs for believing in us and encouraging us to write a playbook that felt unique to us (and felt crazy to many others) and to the countless others who we’ve interacted with over the years to lead us to where we are today. Above all else, thank you to our families (in particular, our wives, Lauren and Eva) for being the first ones to bet on us and the future of Equal Ventures.
It’s the dawn of a new Age and with humility and gratitude, let the Age of Equal begin!