Collaborative Fund

Thirteen people. Four funds. $250 million. 50+ invest­ments. Offices in SF & NYC. We launched Collaborative Fund in 2010 with a simple idea: This was a novel concept at the time. Private investors have historically fallen into two categories: People trying to make as much money as possible, and people trying to make the world a better place. Those trying to make as much money as possible traditionally operated in a “good ol’ boys” network. It was a clubby system, and they could count on raising big money from institutional investors who saw them as the gold standard. Those trying to do good were effectively philanthropists. It worked like that for decades. But the world evolved. Two trends started a tectonic shift in the venture capital ecosystem: Access to information Shifting cultural values In the old model, access to good investment opportunities was proprietary. For entrepreneurs, just connecting with good VCs was a challenge. And large investors had a hard time picking which VCs were positioned for success. There just wasn’t a lot of information. That changed as VCs – normally a private bunch – started blogging, and the social web matured thanks to Facebook, LinkedIn and Twitter. The curtain came down, and everyone could see what others were doing. The market became more efficient. New, smaller firms were seeded by investors who shifted from relying on fund-of-funds to investing directly in emerging VC managers. Entrepreneurs could also quickly get to know an investor’s philosophy, and select potential investors based on taste and values. This trend isn’t over: We’re still seeing the massive effects of this flattening of access to information. Also in the last decade, “doing good” became a driving force for building successful, impactful businesses. Once seen as sacrificial to growth and returns, pursuing a social mission now plays a big role when attracting both customers and employees. We went from labeling do-gooders as the kids who got beat up at school to celebrating Elon Musk with Tesla and SolarCity. Collaborative Fund is on the forefront of both trends. It’s a good place to be. We’ve recruited like-minded investors and entrepreneurs who were attracted to both our mission and our approach. And we’re not alone. We increasingly see more investors joining us at the intersection of for-profit and for-good. Established partnerships like Sequoia Capital and Founders Fund have evolved to stress world-changing aspirations. New entrants like Obvious Ventures, Social Capital, Sherpa Capital, and others have joined the fun as well. We’re encouraged by the influx of investors in this space. But we see an opportunity to evolve our strategy and stake out leadership in a few key categories. Inspired by thematically focused funds like Closed Loop Fund and GovTech Fund, we want to be at the top of everyone’s mind – and the first phone call among mission-oriented founders – in five areas that interest us most: Cities, Money, Consumer, Kids, Health. In short, these areas are where we see the biggest opportunities. Cities: For the first time in history, more people are living in cities than rural areas. This trend is expected to increase dramatically in the coming years. By 2030, an estimated five billion people will live in urban areas. International tourist arrivals will rise from 1.1 billion in 2014 to 1.8 billion by 2030. Travel between cities will surge accordingly. The biggest technology companies in the world (Apple, Google, Uber) are working on transportation infrastructure and mapping technology. The proliferation of sensor-enabled devices, at seven billion today, growing to a projected 50 billion by 2020, adds networking intelligence to the real world that allows for software-scale opportunity. Incumbents in this space: Not many. Infrastructure has traditionally relied on government resources. Notable new companies: Uber, WeWork, Waze, Airbnb, Hyperloop. Collaborative Fund investments: Lyft, Tazca Connects.