Chicago Ventures, a local venture capital firm that’s backed startups like Cameo and M1 Finance, has raised $63 million for its third fund, which has already deployed capital to nearly a dozen companies.
The fund, which closed late last year, is the largest fund the VC firm has raised since its inception in 2012. Chicago Ventures’ first $40 million fund was used to invest in 39 startups, and its second $60 million fund invested in 45 companies, according to the firm.
To help support the third fund, Chicago Ventures has promoted Peter Christman and Lindsay Knight to partner, and has hired Jackie DiMonte as a partner. DiMonte, based in Austin, was previously a principal at Chicago’s Hyde Park Venture Partners.
Chicago Ventures doesn’t focus on any particular startup industry but generally invests in seed-stage companies that are based anywhere outside of the Bay Area, Knight said. Besides Chicago, the firm has cut checks to companies in Austin, Dallas, Los Angeles and Indianapolis.
“We don’t think innovation is constrained by geography,” Knight said. “We think great companies can be built anywhere.”
So far, Chicago Ventures has invested in 11 companies out of the new fund, including CognitOps, CoPilot, Forager, Interior Define, NOCD, OneRail, PreFix and Ureeka. Of these 11 funding rounds, Chicago Ventures has led 10. The firm's average check size ranges from $1.5 million to $2 million.
Chicago Ventures says its more than 100 portfolio companies have raised $1.5 billion of follow-on capital, and that 17 of those companies are now valued at over $100 million.
Chicago Ventures has raised its third fund amid a flurry of venture capital news coming out of the city. Local VC firm Lightbank, which has backed companies like Sprout Social and Reverb, announced last week that it raised $180 million for its second fund.
Additionally, a group of startup founders last week launched The Midwest Fund, which has plans to invest in 30 to 40 companies over the next two years, writing checks between $50,000 and $100,000. And local tech and startup organization P33 revealed a $5 million fund that will invest in Chicago’s Black and Latinx startup founders.
While Chicago has long endured criticism that it doesn’t have enough funding resources, new funds from established firms, as well as upstart VC funds focused on the region, should come as welcome news to early-stage founders.
“It’s very exciting for the ecosystem,” Knight said. “It will be good to have more capital available for more people earlier on.”
