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Susa Ventures leaves Los Angeles as it opens a new $50-million investment fund

Susa Ventures leaves Los Angeles as it opens a new $50-million investment fund
Susa Ventures general partners Leo Polovets, left, Chad Byers and Seth Berman. On Tuesday, they unveiled a new investment fund that targets start-ups in their earliest stages. (Susa Ventures)

The investment firm Susa Ventures won’t have any partners based in Los Angeles as it begins investing from a new $50-million fund.

Susa unveiled its second fund — double the size of its first — Tuesday. In looking at the first batch of investments, Susa’s geographically spread apart team realized that most of the companies were in the San Francisco Bay Area, including finance start-ups Robin Hood and LendUp. They decided to consolidate in San Francisco, too.

“To take it to take next level, we all needed to be in the same office and S.F. seemed like the best,” said general partner Seth Berman, who moved there from Los Angeles more than a year ago.

The shuffle led to the departure of general partner Eva Ho, who will keep working with the first fund but decided against leaving Los Angeles to be part of the second fund, she and Berman said.

“I wanted to refocus on L.A.,” Ho said in an email, adding that she’s working to raise a new fund. “My new fund will be complementary with Susa, so the hope is we will continue to work together.”

Susa, which has invested in Venice start-up Whisper, plans to continue working with Los Angeles companies — just on a fly-in basis.

“While incredibly excited by the opportunities and prospects within the L.A. market, the partners found it to make more sense to cover L.A.'s maturing market by spending one week a month here rather than vice versa,” spokesperson Rachel Rogers said in a statement.

The firm’s first fund generated more than 35 investments from its arrival in 2013 to its exhaustion earlier this year. Berman pointed to Andela, which makes African software developers available to other companies, and analysis tool maker Periscope Data as among the fund’s success stories so far.

With the second fund, he and his two colleagues plan to make nearly a dozen investments annually. It has already completed three undisclosed deals. With more money, the firm will be able to increase most individual investments to a maximum of about $750,000,  up from $500,000.

Susa also wants to add a pair of analysts, a recruiter who would help the start-ups and more events to bring together and spotlight people at the firms. For now, Susa conducts quarterly surveys to spread ideas for problems shared by multiple companies in its network.

“What sets us apart is the founder community we’re trying to develop,” Berman said.

The group has focused on funding companies that have the potential to beat back competition by amassing unmatchable data, a large pool of users or other size-based advantages.

Areas of interest at the firm include self-driving car technology, services that collect data that haven’t been gathered before and apps that aid in common workplace tasks by analyzing readily available information.

Susa Ventures got the cash to invest largely from Horsley Bridge Partners, which supports many top Silicon Valley venture funds. Other investors include wealthy families and larger venture capital firms, Susa general partner Leo Polovets said.

Sports and music streamer NextVR gets $80 million

NextVR announced an $80-million investment from several funds, including many in China, as it races to become the dominant virtual reality streaming service for exclusive sports and music events. The new investors include Chinese gaming company NetEase and South Korean conglomerate SoftBank. NextVR received more than $30 million previously.

The Laguna Beach start-up has struck deals with events promoter Live Nation and sports tournaments such as golf’s U.S. Open. It gets video of events from an array of cameras and then streams the footage through an app that’s available on virtual reality headsets including the Samsung Gear VR.

The experience gives viewers the ability to pan around a shot, a level of interactivity unavailable on traditional TVs. Though few people have the needed headsets today, NextVR is betting that staking out turf worldwide early on will pay off.

Elsewhere on the Web

Sony Pictures became the first to buy a 360-degree video ad on Snapchat, meaning users could move their phone around to navigate through a scene tied to the movie “Don’t Breathe," according to Marketing Week.

Hyperloop Transportation Technologies, a crowdsourced venture seeking to develop high-speed transit systems across the world, sees India as among its first destinations, according to the Economic Times.

Los Angeles mobile game developer Firefly Games received a $10-million investment from new Chinese investors, including a bank, according to VentureBeat.

Online video maker Arsenic has raised $3 million from investors to continue pumping edgy videos to Snapchat, according to Business Insider.

Tampon disc maker Flex has raised $1 million from Venice mentorship program Amplify.LA and other funds betting on the alternative to traditional menstrual products, according to TechCrunch.

Online video aggregator Pluto.tv says it has 2 million monthly users, according to the Economist.

Ticketing start-up FanFlex has developed an online marketplace to efficiently figure out which venues would best serve musicians based on fan interest, according to Forbes.

Online shopping software maker Sellbrite has left Pasadena start-up mentorship program IdeaLab to move into its own office, according to Pasadena Business Now.

The Dodgers invested in Xperiel, which is developing ways to make apps interact with the real world, such as providing special notifications when someone walks into a stadium, according to the Silicon Valley Business Journal.

Los Angeles start-up Second Spectrum and another sports data company are nearing a six-year, $250-million deal to license information from the NBA, according to Bloomberg.

In case you missed it

Though many shareholders and business partners say Hyperloop One remains on track despite a messy legal battle, even investors and collaborators acknowledge something went amiss. Start-up financing experts say investors may deserve some blame.

Lyft CEO Logan Green has a plan that's far bigger than ride-hailing, and his resume for his first job out of college gives a whiff of his ambitions.

A multimillion-dollar investment from an alliance of five Chinese sports and video game companies will bring upgrades to the nation’s first large-scale e-sports venue in Santa Ana and finance a second location on the Oakland waterfront.

Snapchat removed a virtual face mask from its app after users complained that it reinforced racist Asian stereotypes.

Shyp, which dispatches workers to pick up, package and mail items, broadened its coverage zones from the downtown and Santa Monica areas to also include Highland Park, South Pasadena and Alhambra. 

Coming up

The Los Angeles Venture Capital Assn. hosts its annual meeting Tuesday night in Santa Monica. The event includes a chat with representatives from Los Angeles venture capital funds including Tylt Ventures, Stage Venture Partners, Autochrome Ventures and Act One Ventures.

paresh.dave@latimes.com

 

Twitter: @peard33

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