Sydney Thomaswho was the first to hire pioneer enterprise, a seed and early stage investment fund backing first-time founders, is launching its own venture capital firm.investors from main In the firm she joined 6 years ago, she became an independent partner in a new, unnamed firm. In this environment, the work may feel like a leap forward — as institutional-backed investors warn that emerging fund managers will struggle to raise debut funds given the LP freeze — but Thomas isn’t totally agree.
“I think it’s crazy to start a fund in any environment,” Thomas told TechCrunch. “I haven’t paid much attention to a lot of discussions because I’ve recently learned that early-stage markets are more generally zero-correlated to the stock market; and the over-indexing or over-correction that happens in the stock market is actually unreasonable for early-stage investors. “
Thomas declined to say what type of fund she’s raising — if it’s a 506(c) or 506(b) — or what her average check size might look like. Her company doesn’t have a website or a name yet, but she’ll be in builder mode over the next few months and then open her inbox to invest.
While her new job is clearly still in the early stages, Thomas will focus on addressing the gaps she has identified during her 6 years at Precursor and her experience with 250 companies. She wanted to set up a fund that would support founders in the pre-seed stage and then double down on their investments during the seed stage.
“It sounds normal, but it’s not,” she said. “Many other companies and multi-stage companies outsource pre-seed buckets to Scouting programs, so the partners who actually have the funds are not involved in the founder’s day-to-day complexities.” This reality means that many may turn to multi-stage companies for Startups checking out for the first time will get lost in the sea because senior partners aren’t really reaching out to them for follow-on funding. The investor believes the founders are looking for a high-confidence, pre-seed partner who is interested in leading the next deal. “Given what I’ve seen in the landscape…it’s novel,” she added.
It’s too early to tell whether Thomas’ company is competing with her former employer. A lot of the details are still being worked out, but like Precursor, she’s focused on first-round funding and early-stage entrepreneurs. By choosing a specific vertical, geographic, or founder background as an initial focus, future companies can be markedly different.For what it’s worth, she’s been Writing papers since 2017 About companies that give real people more agency in their lives. (Real People is a good name for a VC firm, just saying.)
Thomas is employed by Charles HudsonAfter graduating from Berkeley Haas School of Business in 2016, he became the founder of Precursor Ventures. Hudson declined to comment, but has previously told TechCrunch that Thomas is interested in streamlining the operations of the individual GP fund, even if the firm handles less than $5 million in committed capital. Today, Precursor has raised tens of millions of dollars in venture financing to back other startups, and Thomas, who started as an intern, is expanding his playbook elsewhere.
“It felt like bringing the Avengers back together,” she said, referring to the limited partner she first spoke with at Precursor. “I called the people I worked with six years ago and I was completely overwhelmed by the support and kindness I received.”
The investor said she’d always wanted to start a fund, but it wasn’t until 2020 that she saw the barriers to entry for venture capital actually drop in a meaningful way. The ‘fundamental shift’ in venture capital, as Thomas describe in the postHighlighted by major news events—such as the first $1 billion Black-owned fund and largest female-founded company—and from sources such as “Carta, AngelList, Flow, Allocate, Recast, Raise, Bridge, Coolwater, Strut Wait.”
Given the lack of diversity in the team of partners in the wider venture ecosystem, Thomas’ move means more. Despite progress, the roles in VC have become increasingly blurred, often intentionally, over time. In any given fund, there can be principals, investors, partners, investment lead partners, and senior partner investors. Depending on the fund, everyone can call it a “partner” and call it quits. Thomas will be joining Precursor’s partner track – where she has led deals for 2 years – but she is starting her career with investment autonomy and decision-making on her own. Thomas will transition into the Precursor’s Risk Partner role. She said the role meant she could insist on regular meetings with the founders, but declined to comment on whether she would remain on Precursor’s payroll or what her financial relationship with the company would look like.
“Once I start [investing], in so much Virgo energy, I couldn’t stop thinking about it,” Thomas said in the interview. “So, I decided to jump in. “