Introducing Fika Ventures — a $40M seed fund

We are excited to announce Fika Ventures, a new $40 million seed fund dedicated to serving entrepreneurs who are building enduring solutions to solve deep systemic problems. While seed funds seem to be multiplying like bunnies, we believe our mix of experience coupled with our far-sighted perspective bring unique value and advantages to entrepreneurs.

The three of us (Eva, TX, and Arteen) are all operators who’ve built early-stage venture funds from scratch despite having opportunities to join larger franchises. We share the primary motivation of wanting to walk alongside great entrepreneurs in their quest to create something extraordinary. But it’s really our differences, our unique paths, and our stories that make this partnership special.

TX started and sold his own company while still in college. Eva has helped build three successful venture-backed businesses (Applied Semantics [sold to Google], Factual, Navigating Cancer) that have had deep societal and technological impact. Arteen successfully grew one of the largest startup communities in LA. We hail from Mozambique, Singapore, and good ‘ol Arizona — a colorful bunch with backgrounds that don’t fit neatly into the typical VC mold. We hope to apply our odd duck lens to be better “bird spotters” (thx Michael Moritz!) and stay rooted to each other through our shared common values. We believe that, collectively, we are greater than the sum of our parts. Ultimately, we hope our brand of venture gives entrepreneurs that extra edge, with the understanding that winning is second to leading and operating with integrity and truth as your north star.

Fika will be investing predominantly in LA and the Bay Area, while opportunistically planting more seeds in burgeoning markets like Seattle and New York. We are very excited about the LA opportunity, as venture capital is still an underserved asset class, especially at the seed level. If you walk down the halls of CalTech, USC, Harvey Mudd, or UCLA, many students now not only want to start or join a tech company, but do it in LA. The recent successes of companies like Snap, Dollar Shave Club, Cornerstone OnDemand, Blackline and others have built new entrepreneurial communities which will be the bedrock for future innovation. By investing and connecting across a few core geographies, we hope to cross-pollinate the best talent, ideas, and culture to create borderless learnings and inspiration.

As second time fund managers, we know we serve entrepreneurs best when we can back our conviction with larger first checks (targeting ~10% ownership for deals we lead, 5% for co-investments), while reserving a significant amount of capital for follow-ons. We also have honed the type of founding teams we are drawn to — we call them ‘visionary pragmatists’, founders who balance the right level of idealism and lunacy with respect and acceptance of the daily grind and need to care about the small things. And as reflected in our team’s makeup, we seek founders from diverse backgrounds with unique stories as well as ones whose value system incorporates a wide aperture for diversity and inclusion.

As we continue our journey as VCs, we periodically get to reflect on the things we have learned — and some we may want to unlearn. To share a few:

  1. Be courageous and dare to walk alone

We view the art of investing as a 2x2 matrix where the axes are “right or wrong”, “consensus or contrarian”. To achieve outsized returns, we know we have to step out on a limb, focus on the non-obvious, and be prepared to swim against the tide when we have conviction. Given we overindex for entrepreneurs who are brave, we need to set the same standards for ourselves. With this, we are prepared to be wrong (often), but expect the rewards to outweigh the risks over the long run.

2. Avoid strategy creep
It’s always so tempting to write a smaller check into a hot, oversubscribed round or get sucked into the appeal of a fast growing later stage company. As a small fund, it’s critical to apply the right level of discipline while not choking our team with inflexible rules that guide a future largely unknown. We work hard to strike the right balance by carefully executing on our portfolio strategy while supporting ideas and solutions that stretch our imagination.

3. 80% Listening / 20% Advising

We’ve noticed many folks want to be VCs because they enjoy teaching, sharing, and coaching. The ones that do it best spend a lot more time asking the hard questions and being really good listeners. We have learned that most founders actually know the answers — and we serve them best by guiding them to make and own their decisions.

4. Get comfortable making impossible decisions

So many of the companies that pitch us have potential, and to only fund 1–2% a year can feel gratuitous and dream-killing. But that is the nature of the beast, and very often, we are making very nuanced decisions pre and post funding. It’s a challenge to not let our emotions get the best of us.

5. We are our biggest competitor

While there are more funds being created than ever before, we don’t view them as competition. We feel the availability of more smart capital (especially in LA) is a great thing for entrepreneurs and the ecosystem. We feel our greatest competition is within ourselves. This is a service-oriented partnership where communication, trust, and mutual respect are the most important building blocks. As such, we focus on helping each other be the best version of ourselves — so we can serve our founders in the most authentic, holistic, and cohesive way possible. Though we now have to work harder than ever to get into the best deals, we hope founders choose to work with us because they truly feel we can give them an unfair advantage.

So why Fika? The literal translation of “fika” from Sweden means “to have coffee”, but the daily cultural tradition it represents means so much more. The connotation behind “fika” is actually time to step away from our routine, connect with others, collaborate, listen, and, most importantly, build meaningful relationships — — exactly what we love to do most with entrepreneurs.

We’ll never take for granted that it is a huge privilege to be entrusted with hard-earned capital from people we now call friends — and to be given the ability to select and empower the best and the brightest to chase their dreams. We acknowledge we have won the career lottery. A big thank you to all our amazing investors (including 15 of our very own portfolio founders) who have helped us begin this new chapter of our lives. Special shout out to Cross Creek Advisors and Knollwood Investment Advisory — as we could not have asked for a better group of LPs.

We look forward to earning our stripes as we help founders make their crazy dreams a reality.

Team Fika

Eva Ho, Tianxiang Zhuo, arteen arabshahi