Fiat Companies on Tuesday said it is combining its growth and venture consulting divisions under a new brand, FGV Capital, along with the launch of its second fund, a $35 million vehicle.
The fintech-focused firm’s general partners, Marcos Fernandez and Drew Glover, told TechCrunch that the decision to combine the businesses was to help the founders, whether they are part of the company’s portfolio or not, with their go-to-market strategies.
Operating under the name Fiat Growth, the consulting firm previously offered startups help with scaling, business and go-to-market strategies. It also gave clients access to its network of industry executives, and that overlap is where Fernandez and Glover see potential for greater exposure and growth.
Glover said combining growth consulting with venture firm has already helped them gain spots on startup cap tables because founders realize they could also tap into the advisory network if they receive money from FGV. He highlighted that the consulting business and the investment vehicle will operate as separate entities and said there are “clear processes” to ensure business relationships do not bias investment decisions.
“The goal is to use FGV’s broader infrastructure to provide our investment team with better information and deeper context, not influence the outcome,” Glover said.
Glover said Fund II’s thesis focuses on the intersection of financial technology with areas such as artificial intelligence, healthcare, commerce and other industries. It took FGV about 18 months to create this new fund, and the duo said they were looking for a mix of LPs that “could do more than provide capital,” such as offer business guidance to their portfolio companies. LPs in this fund include Reinsurance Group of America, MassMutual and Bank of America.
In a risky environment where emerging fund managers are struggling to attract the attention of LPs, FGV is betting that its blended model can help it attract LPs and startups, and generate better returns. Glover said FGV also has a program to help its LPs’ portfolio companies scale, and said it also connects LPs with firms on the advisory side of the business for partnership opportunities.
“That’s where the full-stack model becomes powerful,” Fernández said. “The companies we invest in can become clients that we help scale. The companies we work with can become investments. LPs can become clients or portfolio partners. Different parts of the ecosystem can create value for each other while still operating independently.”
The fund will write checks worth between $1 million and $1.5 million to at least 25 companies (it has already backed 13 so far) over two years. The company previously raised a first fund of $25 million. In total, the company has already supported around 40 companies, including pet insurance company Wagmo and lending agency Possible Finance.
“The goal is to build an ecosystem where capital, distribution and relationships come together and where founders and investors have more ways to win together,” Fernández said.
When you purchase through links in our articles, we may earn a small commission. This does not affect our editorial independence.