Madrona to Invest Beyond Pacific Northwest With New $100M Fund
The biggest backer of technology startups in the Pacific Northwest, Madrona Venture Group, announced a new, $100 million fund Wednesday. The Seattle-based investment firm says it intends to make investments out of its Acceleration Fund in companies outside of the geographic footprint of its current portfolio, and will target companies that are more mature than the ones it has previously backed.
Madrona launched in 1995, and has provided venture capital to many of the most promising technology companies to emerge from the region. It has primarily invested in seed and Series A rounds. Its new fund will concentrate on Series B and Series C deals, financing for what Madrona calls the “acceleration” stage.
“With this new fund, we will lead rounds or partner with other investors on a few select Acceleration Stage companies each year,” Madrona says in a news release. “For us, Acceleration Stage means the company has strong evidence of product-market fit, has demonstrated customer value and product differentiation, and has complimented exceptional founders with key executives to help build AND sell those products.”
Madrona says entrepreneurs it has backed have had success partnering with Microsoft (NASDAQ: MSFT) and Amazon (NASDAQ: AMZN), the two biggest tech companies in the region. Now the goal is to try to help develop innovation ecosystems similar to Seattle’s in other parts of the US by financing and connecting startups with the anchor businesses there.
Madrona has consistently been among the most active venture capital firms in the Seattle area. It previously raised three separate $300 million investment funds (in 2012, 2015, and 2018) as well as a $250 million fund in 2008.
The firm invests in startups developing both products and services for business users, as well as companies working on consumer-facing technologies. Madrona’s tech sectors of interest include cloud computing, the Internet of Things, artificial intelligence, and machine learning.
Madrona has backed several Seattle-area companies that have gone public in recent years, including Apptio (NASDAQ: APTI), Impinj (NASDAQ: PI), Redfin (NASDAQ: RDFN), and Smartsheet (NYSE: SMAR). The firm’s portfolio also includes startups that have raised large amounts of funding but remain private, including Booster, Echodyne, Heptio, Qumulo, and Skytap.