Austin's Capstar Ventures LP said July 21 it has closed its first fund with $41.3 million to back early-stage consumer startups.
The firm, which has already made local investments in startups including Eterneva Inc., was founded by Kathryn Cavanaugh in 2019.
The new fund is part of Project Spark, created by J.P. Morgan Asset Management to help bolster minority- and women-led VC funds. Investors in Capstar Ventures' Fund I fund include J.P. Morgan, Capital Creek Partners and Tiger Partners LP.
According to the announcement, Capstar Ventures invests at the seed and series A stage "in digitally native brands, consumer goods and services, and technologies that power these startups." The firm is specifically looking for entrepreneurs who can address the unmet needs of millennial and Generation Z consumers.
"We seek to invest in founders who are solving their own pain points and who directly relate to and resemble their customers because we have seen how that authentic connection translates into high growth companies," Cavanaugh, who is the firm's managing partner, said in a statement.
Cavanaugh, who moved to Austin in 2019, has a lengthy resume of experience in venture capital and startups, including stints at Mainsail Partners, De Novo Ventures and Grace Beauty Capital. In Austin, she has been supported with initial capital from founders including Kendra Scott.
“We feel fortunate for the opportunity to support those in the earlier stages of building their business and to work alongside phenomenal partners to provide more diverse founders a seat at the table," Scott said in a statement.
Cavanaugh is also a director at Capstar Special Purpose Acquisition Corp., a blank-check company that is trying take public Gelesis Inc., a Boston-headquartered biotherapeutics company.
