Founders Fund Raises Founders Fund II, a $220 Million Institutional Venture Fund

SAN FRANCISCO--(BUSINESS WIRE)--Founders Fund, a non-traditional investment group, today announced it has raised an institutional fund in the amount of $220 million. The new fund, Founders Fund II, will allow this team of four managing partners, who themselves are founders and entrepreneurs, to leverage their individual expertise and deliver their unique business model, which puts the entrepreneurs first. Founders Fund has developed a comprehensive package designed to create near perfect alignment of interests between founders and their investors.

Founders Fund II will be invested in approximately 15-20 innovative early-stage start-up companies. This is the first institutional money raised for the Founders Fund, representing a significant increase over the original fund of $50 million, which was raised from personal investments by the managing partners and select outside investors.

“We believe entrepreneurs are looking for people like themselves, people who also have taken ideas and made them a reality. This second fund allows us to invest in areas for which we have deep insight, personal experience and passion for seeing the companies succeed,” said Luke Nosek, a Founders Fund managing partner. “Our collective experience starting companies and funding innovative start-ups positions the Founders Fund as a unique, valuable resource at the early investment stage.”

The Founders Fund will continue to offer Series FF stock, which is being adopted across the industry adding to the unique approach to funding entrepreneurs. The stock is offered to start-up founders who can convert Series FF stock to preferred stock during subsequent rounds of funding. This allows Series FF stock holders to sell a portion of their stock and aligns their interests with their investors.

“The traditional venture capital model is broken,” said Sean Parker, a Founders Fund managing partner. “By offering tools like the Series FF stock, we are helping create a new model of investment and alignment of interests, confirming our commitment to the founders of our companies. This fund is truly for founders by founders.”

Founders Fund has played a role in a wide variety of start up companies, backing organizations like Facebook, Geni, Powerset, Quantcast, Slide and more. The four managing partners have all started their own companies and between them have seen the process from inception to start up to IPO. They bring that experience and insight to every investment.

“Founders Fund was started to make a difference for companies looking for funding to execute on their big ideas. We believe the alignment of interests with our portfolio companies is the next step in the evolution of collaborative investments,” said Ken Howery, a Founders Fund managing partner. “Founders Fund II will give us the opportunity to continue to invest in the people and ideas that are truly bringing innovation to the Internet industry.”

Peter Thiel, one of four managing partners for The Founders Fund and an early backer and board member of the social media network Facebook said, “This is one of the most innovative venture teams ever assembled. Our unique skill set, expertise and perspective support our shared desire to build and invest in great companies from the ground up.”

For more information on submitting proposals or the fund itself, go to www.foundersfund.com.

About The Founders Fund

Based in San Francisco, Calif. and founded in 2005, Founders Fund is a group of four proven entrepreneurs with a shared vision: to change the way venture investments are made. Founders Fund seeks to provide the capital, insights and support required to build a company from the ground up and sustain successful enterprises with a non-traditional, founder-focused approach. Their current portfolio includes Facebook, Geni, Powerset, Ooma, Quantcast, Slide and others. For more information, visit www.foundersfund.com.