Susa Ventures Announces $375 Million Of New Capital Weeks After Seeing 1,000x Return On Robinhood

Susa Ventures has largely flown under the radar since its founding eight years ago. But as the seed-focused firm prepares to announce its latest batch of funds — mere weeks after seeing a nearly 1,000x return on the first investment the firm ever made — its partners are ready to reflect on the journey to get there. 

Susa cofounder and general partner Chad Byers has always been a Silicon Valley kid. The son of Brook Byers, one of the founding members at Kleiner Perkins, and the brother of Blake Byers, until recently a longtime general partner at GV, he was no stranger to the venture capital ecosystem. After stints in operating roles at companies like marketing startup Integrate and as an angel investor, the youngest Byers thought there must be a way to combine the two passions. “How do you merge operating and building something and investing? The only real answer was to start your own venture fund,” Byers tells Forbes. 

That he did. He launched Susa Ventures in 2013 alongside Leo Polovets and Seth Berman with a $25 million debut fund that included capital from more than 70 family offices and high-net-worth individuals. It was difficult to raise, Byers admits. Now, eight years later, the firm has raised a collective $550 million, seen seven exits from its first fund, and has backed a handful of current unicorn companies.

The San Francisco-based firm looks to continue this trajectory with a newly raised $375 million across several funds, as originally reported in Midas Touch newsletter. One sleeve, Susa Ventures IV, has $125 million for seed-stage opportunities, and the other, Susa Ventures Opportunities II, has $250 million for follow-on investments. This latest raise will allow Susa to continue its bread-and-butter strategy of investing $1 million to $2 million into seed-stage companies, and $10 million to $15 million at the growth stages. While the firm is technically sector agnostic, 90% of its current portfolio is within fintech, software-as-a-service, supply chain and logistics and healthcare, which Byers expects will continue. 

Byers credits his team and the success of Susa’s first fund for the scale they have achieved today, and he isn’t afraid to admit that luck was involved in that fund’s performance. “The first deal I did in the fund was Robinhood,” Byers says, a $250,000 investment in 2013. “As a firm we got extremely lucky that the founders of Human Interest, Policygenius, all those entrepreneurs, took a chance on us as an unknown fund at the seed stage.” Despite its early victories, Susa has been careful not to expand too quickly, Byers adds. The fund raised $50 million for its second fund in 2016, and $90 million for its third three years later, despite knowing that they had interest to raise significantly more. “Your fund size is your strategy,” Byers says. “We are firm believers that your fund size should be an output of the details that matter.”

That third fund had included another venture, a Series B- and Series C-focused opportunity fund inspired by the partners getting tired of raising external SPVs for follow-on rounds. Susa also opened up its funds to its underlying portfolio companies to invest in as LP at the time; more than 100 entrepreneurs participated. “The reaction was the most positive thing I’ve ever seen,” Byers says. “It’s been an incredibly powerful thing for us from a dealflow perspective. It’s been a huge windfall; it also just feels like absolutely the right thing to do.”

While Byers grew up immersed in the venture world, he knows how hard it is for many to break into the market. In addition to the fundraises, Susa is formally announcing its fellowship program that started in 2020 to help people get experience in the industry, regardless of their background. One class of fellows have gone through so far, working with the team for six months to help with everything from pitch meetings to investment decisions. “They are quite literally doing the business,” Byers says. “The goal is to expose the business of venture capital to more people. Most people don’t know anything about it.” 

Since the first program ended, half of its members have gotten hired at venture firms, including Susa, and some have formed their own angel syndicate group. “We are so excited about doing this indefinitely. We have committed to funding this thing,” Byers says. Applications are already collected for the second cohort.