Next Coast Ventures wrangles $310M in new funds as Austin’s VC scene booms

Austin-based Next Coast Ventures has raised $310 million across three funds as it looks to support innovative startups in emerging tech hubs.

The news comes on the heels of a banner year for startups based in the Austin area. Venture investors funneled more than $5.5 billion into 412 deals during 2021, more than double the amount of capital invested in 2020, according to PitchBook data.
 

 

“The amount of capital, the diversity of capital, the quality of entrepreneurs and the quantity of excellent talent have all dramatically increased in Austin,” said Mike Smerklo, co-founder and managing director at Next Coast Ventures.

Since its launch in 2016, over 60% of the firm’s investments have been companies headquartered in Texas, with the vast majority based in Austin.

Next Coast’s portfolio includes Everly Health, a provider of at-home medical tests for COVID-19, fertility, allergies and more. The Austin-based company was valued at $2.9 billion in March 2021, according to PitchBook data.

Another notable portfolio company is ICON, a developer of 3D-printing tech that’s used to build homes and structures across the US and Mexico. In February, TechCrunch reported that the startup had raised $185 million in a Series B extension led by Tiger Global.

Next Coast’s latest capital infusion includes $195 million to back early-stage startups and $50 million to support existing portfolio companies.

The firm has also allocated $65 million for entrepreneurs looking to acquire a small or medium-sized company and manage it as CEO. “Typically these are great businesses that have yet to be discovered by the traditional private equity community,” Smerklo said.

Texas continues to be the firm’s main region of focus, followed by Florida, the Midwest and the Rockies, he said.

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