Xfund

Xfund
Predecessor Experiment Fund
Formation January 27, 2012 (2012-01-27)
Founder David Edwards,Hugo Van Vuuren
Jim Breyer, Alan Crane,
Harry Weller, and Patrick Chung
Founded at Cambridge, Massachusetts
Type Venture capital
Headquarters Palo Alto, California
Services Early stage venture capital
Fields Consumer technology
Enterprise technology
Healthcare
Key people
 Patrick Chung
Brandon Farwell
Website xfund.com

Xfund is an American venture capital firm with offices in Palo Alto, California and Cambridge, Massachusetts.[1] It provides early-stage venture capital to entrepreneurs across multiple disciplines. Since its founding, it has invested in 23andMe, Halo Neuro, Kensho, Landit, Ravel Law, Rest Devices, and Zumper, among others.[2][3]

Xfund was founded as the Experiment Fund in 2012 as a partnership between the venture capital companies New Enterprise Associates, Accel Partners, Breyer Capital, and Polaris Partners. Anchored at Harvard University’s School of Engineering and Applied Sciences (SEAS), it was established to make seed-stage investments in startups developed at Harvard and MIT. In 2014 its investment portfolio was acquired by Xfund, a $100m successor fund co-founded by Hugo Van Vuuren and Patrick S. Chung.[4][3][5]

History

Experiment Fund

The Experiment Fund was launched in January 2012 as a $10 million seed fund and incubator designed specifically to support student start-ups and develop technologies and platforms created in Cambridge.[4] Its advisors included Harvard faculty members Edwards, Murray, Harry Lewis, Doug Melton, and John Palfrey, in addition to MIT researcher Hugo Liu, Facebook co-founder Andrew McCollum, Breyer Capital's Jim Breyer and NEA's Harry Weller and Chung. To avoid potential conflicts of interest, Harvard had no financial stake in the Experiment Fund.[4][6] Run with Van Vuuren as the "on the ground" full-time partner in Cambridge,[5][7] approximately 50% of the deal-flow in the original fund came from companies launched by Harvard students, faculty and staff. 25% came from MIT-affiliated entrepreneurs and 9% from Stanford.[8][9][10]

Experiment Fund identified more than 3500 investment opportunities in the community in the first two years of its existence.[8] It evaluated 900 companies and invested in five. The average markup of the portfolio from seed valuation to valuation in May 2014 was over 10x.[11]

Xfund

In December 2014, Van Vuuren and Chung raised $100 million in capital commitments for a second fund, and founded Xfund. Experiment Fund investments were rolled into the Xfund portfolio, and the company was renamed Xfund.[12][13][14] Xfund's limited partners included Top Tier Capital, Goldman Sachs, Saudi Aramco, Jasper Ridge and Breyer Capital.[3]

Lawsuit

In January 2016, Van Vuuren reached out to Xfund's Limited Partners Advisory Committee (LPAC) accusing Chung of mismanagement in response to the firing of an employee. Separately, Chung had also reached out to the LPAC requesting intervention and raising questions about Van Vuuren's stability. In March 2016, the LPAC voted to fire Van Vuuren and put Chung in charge.[5]

In May 2016, Van Vuuren filed a civil lawsuit against Chung, alleging fraud, breach of fiduciary duty, defamation, and a violation of California's two-party consent law.[5][15][16] The case was settled in February 2017.[5][17]

Brandon Farwell, previously of Rothenberg Ventures, subsequently joined Xfund as a partner.[11]

References

  1. ↑ "Xfund Contact". Retrieved December 6, 2017.
  2. ↑ Anders, George (September 28, 2015). "These VCs Bet $100 Million On Ideas With A Liberal Arts Twist". Forbes. Retrieved 3 December 2017.
  3. 1 2 3 Benner, Katie (May 6, 2016). "Infighting Threatens to Fell a Venture Capital Firm". New York Times. Retrieved 21 November 2017.
  4. 1 2 3 Farrell, Michael B. (September 9, 2013). "Harvard makes space for venture capitalist". The Boston Globe. Retrieved 20 November 2017.
  5. 1 2 3 4 5 Hempel, Jessi (November 8, 2017). "The Inside Story of Venture Capital's Messiest Breakup". Wired. Retrieved 21 November 2017.
  6. ↑ "Early-stage venture fund launches". Harvard Gazette. January 27, 2012. Retrieved 21 November 2017.
  7. ↑ Wu, Victor C. (April 25, 2013). "Partners Reflect on Experiment Fund's First Year". Harvard Crimson. Retrieved 3 December 2017.
  8. 1 2 Landry, Lauren (December 4, 2014). "Harvard-Based Xfund Closes $100M Second Fund". American Innovation. Retrieved 21 November 2017.
  9. ↑ Wu, Victor C. (April 25, 2013). "Partners Reflect on Experiment Fund's First Year". Harvard Crimson. Retrieved 20 November 2017.
  10. ↑ "The Experiment Fund welcomes Accel, Polaris, and new advisers". harvard.edu. Harvard John A. Paulson School of Engineering and Applied Sciences. June 26, 2012. Retrieved 29 November 2017.
  11. 1 2 Boslet, Mark (May 28, 2014). "Experiment Fund looks ahead". PE Hub. Retrieved 29 November 2017.
  12. ↑ Primack, Dan (May 28, 2014). "Exclusive: NEA's Patrick Chung to join Xfund fulltime". Fortune. Retrieved 30 November 2017.
  13. ↑ Primack, Dan (December 4, 2014). "Harvard-affiliated VC fund raises $100 million". Fortune. Retrieved 21 November 2017.
  14. ↑ Chapman, Lizette (December 4, 2014). "Xfund Closes $100 Million Second Fund, Targets Student Entrepreneurs". Wall Street Journal. Retrieved 29 November 2017.
  15. ↑ Geron, Tomio (May 16, 2016). "Lawsuit Escalates Xfund Conflict". Wall Street Journal. Retrieved 1 December 2017.
  16. ↑ "New Lawsuit against Patrick Chung, David York, and hijacking of Harvard". scribd.com. Superior Court of the State of California (via scribd). Retrieved 3 December 2017.
  17. ↑ Primack, Dan (October 6, 2017). "The return of Xfund". Axios. Retrieved 3 December 2017.
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