This Seattle VC firm is led by three general partners under 40 – GeekWire

A venture capital firm led by young partners who don’t have decades of investing experience might deter some entrepreneurs and investors.

Fuse isn’t running into that problem.

The Seattle venture firm, which spun out of Ignition Partners in 2020 and raised $170 million for its first fund, is led by three founding general partners aged 35 or younger:

• Cameron Borumand, 30, a University of Washington business school grad and former investment banker who previously served as a principal at Ignition.
• Kellan Carter, 35, a Montana native who cut his teeth backing early-stages startups while at Ignition for seven years.
• Brendan Wales, 35, a former partner at Headline, a Bay Area firm formerly known as e-ventures that has backed App Annie, Bird, gopuff, Sonos, and others.

NFL star Bobby Wagner, 32, is a venture partner at the firm.

Fuse is unique for both its youthful leadership pedigree and the size of its first fund. And the firm, which invests in early-stage software startups based in the Pacific Northwest, doesn’t appear to be slowing down on the fundraising front.

A SEC filing from last month revealed an offering amount of $250 million for “Fuse Venture Partners II,” which would mark a massive new injection of capital into the Seattle-area startup ecosystem. Fuse declined to comment on the filing.

There are just five first-time funds in the Seattle region that have raised more than $150 million since 2009, according to data from PitchBook. Fuse’s initial fund is significantly larger than other firms that debuted in recent years, including PSL Ventures ($80 million for its first fund), Flying Fish ($37 million), and Unlock Ventures Partners ($25 million).

The two-year-old firm is “filling a gaping hole in the Pacific Northwest venture landscape,” said Bill Bryant, a longtime Seattle-area investor who participated in the firm’s first fund. It is large enough to lead big seed rounds without syndication, and can follow on with significant capital at the Series A stage, Bryant said.

Kirby Winfield, a former startup leader who started his own Seattle VC firm Ascend in 2019, said Fuse is bringing “new energy to the local seed and Series A capital market.”

Winfield, 48, said being on the younger side of venture can be advantageous — both for firms themselves, and the ecosystems they operate within.

“Younger investors building a platform that reflects their worldview and experience will undoubtedly connect with founders in a unique way — meaning that local startups will be that much more likely to find funding close to home instead of being lost to Valley VCs,” Winfield said.

There can be downsides, too.

The partners at Fuse have not managed funds or worked with companies through tough economic cycles.

To address those issues, Fuse picked partners, like Bryant, who can provide guidance and mentorship.

“They work as hard as any team I have been around in almost 35 years working in technology.”

“We learn from people that have gone through some really challenging times in business and came out the other end,” Wales said.

Fuse’s leaders are among just a handful of young partners across the nation that have raised sizable funds.

The age range of 35-to-50 includes investors that have some experience but “aren’t so jaded that they ignore the themes and zeitgeist of the moment,” said Bryant.

“It doesn’t feel like necessarily diligence or work because you’re at a similar life stage,” Carter said of scouting startups and meeting founders.

The median age of founders leading startups valued at $1 billion or more over the last 15 years was 34, according to research in a book published last year.

Fuse’s general partners also see themselves as founders, given they launched the firm — something that helps build a bridge with startup leaders.

“The vast majority of our net worth is in these funds,” Borumand said. “We operate Fuse very similarly to how the founders operate their businesses.”

Carter wouldn’t say if the firm has lost any deals due to their ages or lack of investing experience. But that wasn’t an issue for some startup leaders who took cash from Fuse.

“That question did not arise for me,” Vikram Chalana, CEO of Pictory.ai, said of Fuse’s youth.

Paul Mikesell, CEO of weed-wacking startup Carbon Robotics, said the approach from Fuse was different.

“All of the partners from Fuse feel more as part of the team, as opposed to benefactors from on-high who sagely approve or disapprove of your results,” said Mikesell, who previously co-founded Isilon Systems. “Every founder and board member of a venture-backed startup knows exactly what I’m talking about.”

Fuse’s leaders acknowledge that while it built its LP community from scratch, it does have strong support from Ignition, founded in 2000 by a group of Seattle-area tech execs. Longtime Ignition managing partner John Connors, former CFO and CIO at Microsoft, is an operating partner at Fuse, along with Satbir Khanuja, who joined Ignition as a venture advisor in 2018 and previously led DataSphere Technologies.

Ignition’s history and connections help give Fuse an advantage, particularly compared to other first-time funds.

Connors worked with Carter and Borumand for multiple years at Ignition, and met Wales later on. Betting on the young guns was an easy call.

“Dynamite team,” Connors said. “They work as hard as any team I have been around in almost 35 years working in technology.”

Ignition effectively sunsetted its brand name and is managing existing investments in portfolio companies such as Icertis, Skytap, and others.

While Ignition spread itself outside of the Seattle region, with a Bay Area presence and even a China investing arm, Fuse is hyperfocused on the Pacific Northwest, where it has backed companies including WellSaid, bttn, Zuper, and others.

“We’re very, very bullish on this ecosystem,” Borumand said.