On the heels of Underscore VC’s largest community event of the year, Core Summit, the firm has some funding news on the horizon.
The Boston venture capital firm, which focuses on early-stage startups, has indicated it's targeting $50 million for a third fund. The fund was identified as “Underscore.VC Fund III, L.P.” in a filing with the U.S. Securities and Exchange Commission on Monday.
Underscore declined to comment on the filing, citing SEC regulations.
Underscore invests in B2B seed-stage companies. The firm says about half of its investments are in B2B vertical SaaS (software-as-a-service) startups, and the other half is for fintech and emerging technologies. Its seed-stage investments usually range from $1 million to $5 million.
The firm told BostInno it made more than 30 investments from its second fund. Its local portfolio companies from its first two funds include Hue, Goldcast, Salsify and TetraScience. Underscore said 26% of its portfolio comes from the Boston academic innovation ecosystem, and about 60% of its portfolio companies are Boston-based.
According to the filing, the first sale on its third fund has yet to occur, and the firm expects to complete this offering within a year. The size of the final round has yet to be determined.
In 2016, Underscore targeted $75 million for its first fund and ended up raising $85 million. The firm then raised its second fund just two years later, announcing it had raised $117 million in May 2018.
At the time it announced its second fund, Underscore said it was still making investments from the first fund. Underscore founding partner Michael Skok said they were “caught by surprise ourselves” and weren’t expecting this funding until later in the year.
Other Boston-area venture firms are also bringing in new capital. Converge, a Cambridge-based venture capital firm, also plans to raise $50 million for a third fund. At the end of August, Elephant Partners, a Boston-based venture capital firm, raised $791.5 million for its fifth fund.
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