A first-check, early-stage investment fund that got its start in New York City is expanding to the Midwest, and one of its general partners is the former founder of one of the area’s most well-known startups and a Brandery alum.
The Fund Midwest — part of The Fund network, which since its launch in New York in 2018 has expanded to Los Angeles, London, the Rockies and Australia — will invest in tech-enabled, early-stage companies in a roughly six-state territory that includes Ohio. The former founder and CEO of ChoreMonster Chris Bergman, who now runs Gylee Games, a video game development studio in OTR, is one of five general partners involved.
The Fund differentiates itself from other venture funds because it’s founder-led and founder-driven. It's backed by entrepreneurs who want to reinvest in their region. Bergman said The Fund Midwest fills a major void in the ecosystem, where there’s currently a lack of pre-seed and seed-stage capital. More seasoned venture funds have started to focus more on startups at Series A and beyond, he said, leaving early founders without a springboard – and capital – for their ideas.
In the Midwest, The Fund will cut $50,000-$100,000 checks to startups based in Ohio, Michigan, Illinois, Indiana, western Pennsylvania and Kentucky. It could invest in roughly 24 startups a year.
“A lot of venture funds have moved upstream and are looking at more specific metrics,” Bergman told me. “But for a lot of these CEOs, it’s their first time being a CEO or founder. We want to support them with a group of mentors who are directly invested at a capital level, but who are also invested on a personal level through mentorship, networking and more.”
As part of its launch, The Fund Midwest will be led by Bergman and fellow founding general partners, or investment committee members, Ted Serbinski (Detroit), Lynsie Campbell (Pittsburgh), Tapan Kataria (Detroit) and Jennifer Fried (Chicago). Bergman said the group is intentionally diverse. He and Serbinski know each other from the now-defunct ChoreMonster, which developed apps to help families manage household chores. Serbinski served on ChoreMonster's board.
The Fund, while it fills a void, is also a huge win for the ecosystem at large, said John McIlwraith, co-founder and managing director for Allos Ventures, an Indianapolis-based VC firm with a Cincinnati office. The Fund target companies that are often considered the highest-risk, highest potential. The fact the first checks are backed by other founders who have business-building experience gives it a solid foundation, he said.
“Having seen things from their side, they’ll be able to better select, better support the founders they back with that first-check money and increase the odds of those companies moving to seed funding and ultimately venture funding and beyond,” McIlwraith told me. “To have a fund like that in the Midwest, with a Cincinnati connection, is terrific news.”
Bergman said the group is already targeting its first investments. He expects its inaugural fund to close soon, with a target of $3 million to $5 million. The plan is to write roughly two checks a month for the next two years. Besides a focus on tech-driven startups, he said The Fund will remain sector-agnostic.
Besides its founding general partners, Bergman said The Fund is recruiting 50 additional LPs, or investors, who are also founder/operators. Notable founding LPs with local ties include Charlie Key and Brandon Cannaday of Losant and Eron Bucciarelli of Tixxy. All are also Brandery alums.
