after working together For nearly a decade, three former CEOs of Amex Ventures in early 2022 branched out to form their own fintech-focused venture firm, Vesey Ventures. The trio had made early investments in more than 50 fintech companies, including Stripe, Plaid, Melio, and Trulioo. During that time, they also helped design more than 100 partnerships between startups and financial services institutions.
His goal was to take those 10 years of experience investing through the venture capital arm of one of the world’s largest credit card companies and apply it firsthand to new early-stage investments, but with a twist. The firm says it intends to move beyond term sheets to issue bespoke “Strategy Sheets,” outlining how Vesey Ventures intends to leverage its network “to act as a company’s first business development team.” In other words, it wants to invest in early-stage fintech and enabling technology companies “where there are opportunities for early partnerships with financial holders.”
And today, the firm, made up of founding partners and friends Dana Eli-Lorch, Lindsay Fitzgerald and Julia Huang, who all left AMEX Ventures at the same time in late 2021, announced the closing of its $78 million debut fund. They named the firm Vesey Ventures after the street where American Express is headquartered in New York. (They declined to say whether Amex is a limited partner in the new fund.)
The feat is particularly impressive when you consider that, according to PitchBook data recently cited by Information, “Women-led venture firms in the US have raised just $74 million this year.” This means that by closing her debut fund, Vesey has effectively raised more than all female-led VC firms in the US combined and more than double the amount raised by female-led VC firms in so far in 2023.
Vesey’s self-described mission is to support companies “transforming financial services” from the early stages to Series B. He plans to invest $1.5 million to $3 million as initial checks and larger amounts for follow-ups. Based in the United States and Israel, the fund has so far backed five startups, including Coast, Cyrus, Grain, Equi and Appropriate.
Vesey defines fintech in its broadest sense, meaning it invests outside of traditional financial services categories like consumer and B2B, Eli-Lorch said in an exclusive interview with TechCrunch. He also discusses the software vertical, embedded financial technology, the future of commerce, and the infrastructure layer; basically, cybersecurity, risk, and compliance, or as Eli-Lorch describes it, “all back-office operations of financial services.”
“Another lens that we take is basically any kind of tech software innovation that is sold in financial services, meaning financial institutions or fintechs,” he said.
bridging a gap
All of the founding partners agreed on one thing when starting the new company: that it was clear that new companies with better business development strategies had better results.
“And that is ultimately the idea on which we build a thesis,” Fitzgerald said. “In this industry, this development is not a ‘nice to have,’ it’s a ‘need to have.’ ”
“However, the traditional corporate venture capital model can be limiting, so we saw an opportunity,” he added. “We took the best of what was clearly working (business development, our team, our network), including other VCs and angels, and expanded it…to bridge the gap between companies that need new technologies and startups that build those. new. technologies.”
Today, the partners acknowledge that an interesting phenomenon is occurring: top executives from what they describe as “first generation” fintech startups. And, despite the recent volatility the fintech space has experienced over the past two years (funding dropped significantly in 2022 compared to its 2021 peak), Vesey is naturally “long-term bull” on fintech.
“You only need to look at the last quarter of volatility and turmoil in the financial services industry to really signal that there are many, many issues that still need to be resolved,” Huang told TechCrunch. “Having said that, things are cyclical…it’s like when the tide goes out, you see who’s a little naked, right? And for us, that’s the infrastructure layer… that we always help our companies build and harden so they can become long-term, trusted financial institutions. That has become a very important pillar, and now it is back in fashion”.
Huang also acknowledges that in 2021, the trio stopped investing “because it was getting too foamy.”
“Each company was a kind of ‘me too company,’” he recalls. “So we decided to take a step back and think about our value proposition and what has legs and what doesn’t.”
Vesey intentionally chose to be on the ground in Israel (Eli-Lorch is based there), a market partners see as home to one of the world’s fastest-growing technology hubs, with many companies focused on fintech, enterprise software, cybersecurity, and data. Their goal is to help startups partner, expand, and market in the US.
The new firm is keeping quiet about its LPs, saying they only include seven “very prominent financial institutions” as well as founders and executives of financial holders, family offices and institutional investors.
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