Gallery
renegade
Share
Explore

renegade
Renegade Partners Nets $128 Million as Smaller Funds Have Their Moment

The average venture fund size hits its lowest level since 2017
⁠
image.0.png
⁠
⁠
San Francisco-based Renegade Partners plans to invest in 20 companies with its new fund, mostly at the Series A stage. (Photo: Loren Elliott/Bloomberg News)
By Marc Vartabedian
May 01, 2024 06:00 a.m. ET
Renegade Partners, an early-stage venture firm founded in 2020, has reloaded with a $128 million sophomore fund, the latest example of the shift away from megafunds in favor of small or medium-size funds across the industry.
The fund’s size will allow the firm to lead deals and focus on each investment, Renegade’s co founders said. The firm isn’t focused on any specific sectors.
“LPs understand that returning a billion-dollar early-stage fund is very difficult,” said Roseanne Wincek, a Renegade co-founder and managing director who was previously a partner at IVP and principal at Canaan Partners. “If we look historically at venture, what has done well are right sized funds—call it one, two, maybe $300 million at the early stage.”

⁠
Screenshot 2024-05-01 at 5.07.16 PM.png
Roseanne Wincek, left, co-founder and managing director of Renegade Partners, with Renata Quintini, co-founder and managing director of Renegade (Photo: Brendan Mainini)
⁠
⁠
Even for smaller funds, tapping limited partners these days isn’t easy. Most of the fundraising for Renegade’s new fund took place in 2023. The San Francisco-based firm’s co-founders said the fundraising process was tougher and took longer than expected because of macroeconomic conditions.
“There was massive exuberance when it came to fundraising and in 2022 that stopped very fast,” said Wincek.
The drop in average fund size is a turnaround from the easy money days of 2021 when massive funds, many over $1 billion, were commonplace.
The average size of a U.S. venture fund in the first quarter of this year was $105 million, a 34% fall from all of last year and its lowest level since 2017, according to analytics firm PitchBook Data and trade group National Venture Capital Association. The number of venture funds larger than $500 million as a proportion of all venture funds raised dropped from 8% in 2023 to roughly 5% in the first quarter of this year, said Kaidi Gao, a venture analyst at PitchBook.
Gao attributed the phenomenon to large funds slowing their investing pace and, as a result, not needing to raise additional capital. Gao also said that venture capitalists have tempered their fund size expectations.
“Fundraising has become a lot harsher during the past two years, and managers who successfully raise from LPs are more thoughtful about their strategy and fund size expansion,” Gao said.
To be sure, stalwart venture firms are still raising large war chests. Last month, Andreessen Horowitz said it raised roughly $7 billion across a handful of new funds, including a roughly $4 billion growth vehicle.
Renata Quintini, a Renegade co-founder and managing director, said,” By the time we went to raise Fund II, we already had led a bunch of rounds in exciting companies. We had outcompeted legacy Sand Hill firms. So we thought, ‘This is going to be a walk in the park.’ But the floor kind of fell on the industry.’” Quintini previously was a partner at Lux Capital and general partner at Felicis Ventures.
The founders said their record at their previous firms helped them raise the second fund. Renegade’s LPs include institutional investors such as pension funds and foundations. The firm has $228 million in assets under management.
Renegade plans to invest in 20 companies with the new fund, mostly at the Series A stage. The firm’s investments include aerospace startup Air Space Intelligence; sales training software provider Spekit; and industrial automation software developer Copia Automation.
Write to Marc Vartabedian at marc.vartabedian@wsj.com
Gallery
Share
 
Want to print your doc?
This is not the way.
Try clicking the ⋯ next to your doc name or using a keyboard shortcut (
CtrlP
) instead.