The 26 most innovative venture capital firms

Gil Pencina is one of the best Angels around, having invested in every single major Tech company. He wants Flight.Vc to become the Fidelity of startup investing. He recruits managers for each syndicate, which do all the work.

Cnn's John Sutter talks with founder of software firm Signalfire. The firm uses software to spot investment opportunities and help its portfolio companies hire top talent. Signalfire raised a first $53M Fund and should be just about done raising its second $300–350M.

DKV is another pretty futuristic firm that touts its use of data as a competitive advantage. They use a software created by a 3rd-party company called VITAL to spot investment opportunities (mainly in the life sciences sector) — they even named the algorithm to the board in a PR move.

Tusk ventures recently participated in the a and B rounds of one of our portfolio companies, and I couldn’t be happier. They’ve developed a brand in Silicon Valley for helping companies navigate hard and uncertain regulatory terrain, which in this case were the #1 risk for the company. There have been a lot of Work-For-Equity schemes around Obviously, but this one is a very scarce Skill-Set that can actually command equity from top startups.

Redstone basically offers a 'Vc-As-A-Service' model to big corporates. Instead of saying: "give me your money and we'll see in 10 years how good we were at managing it" this is a massive value proposition to companies that want to dip their toes in the corporate VC world but have no idea where to get started.

Kima is a hybrid French/ Israeli firm which has invested in more than 400 companies. They do so by moving extremely fast and making investments as often as 2–3 times per week. They also built a first in the VC world, a status Tracker for their evaluation of a deal.

Dave has pioneered the High-Frequency ‘ index’model of startup investing. He believes that investors can’t really pick the winner so the best way to invest is to just invest in a whole lot of companies and follow-on on the best ones. This approach has made him quite a few enemies in the valley.

Jessica and Paul are true Visionaries, and with the ambition of Sam Yc is not really stopping for a moment. It’s crazy to think that when they first launched, there was no early stage acceleration program for startups.

The guys at Sosv create a number of vertical accelerators and exclusively fund all operations and investments. They tout $250M Aum, 500 startups and a solid 30% net Irr. You should read the fascinating story of the founder.

Ef is a Pre-Idea Entrepreneurship program. They take the brightest young minds from top universities and help them meet other people and launch a startup. Twitter has bought up one of their companies for $150M, and the others are not doing to bad either. The results have certainly been brilliant, given Twitter has bought up one of their companies for $150M.

Indie.vc has a model where it will get paid back by dividends from the company. It will get 80% until it gets paid 2X and then 20% until it reaches a hard cap of 5X its investment. Should the company decide to go for Hyper-Growth and raise additional funds, its investment will just turn to equity at a Pre-Negotiated conversion price. Indie.vc is now on their V2 and made $100K-500K investments.

Lighter capital raised $17M for their operations, and invest out of a $120M LP pool. They write checks of up to 1 3 of a company’s annualized revenues and don’t get any equity. This is an extremely smart model, which drives probably around 30% annual returns with much lower risk than what Vcs have. Lighter capital is able to use a lot of data and Metrics to project revenues.

Bullpen was the Firsts to aggressively go after a clear opportunity in the VC market. They were the Firsts to aggressively go after the famous "series a" crunch. Bullpen has been able to invest in companies that needed just a bit more time before raising their series a, but whose Seed-Round Vcs wouldn’t bridge.

Dcvc ’ s innovation stems surely for its approach to backing extremely deep Tech. Employing a “collective” approach of giving experts (Lps and not) meaningful carry in exchange for their help Vetting and helping its portfolio companies. They are now investing their fourth core Fund, of $177M, with previous funds having been $140 fund III, $75–100M fund II and $6M fund I. they also have two $125M opportunity funds.

Kent Goldman was exposed to innovation in VC early on, being a principal and then a partner at first round capital. He took a spin on the model and made every single entrepreneur he invests a carry holder. The percentage of carry reserved to Founders is probably around 20–40%.

When you visit the A16Z offices, it doesn’t feel at all like you’re in a VC firm (even if they kept the old tradition of being on Sand Hill Road..). Their goal is to model the firm after a creative agency, and employing more than 100 people it seems like they’re committed to it.

Rising from a brand-new firm to the top 3 in the world in half a decade is just unheard of, and yet this is exactly what A16Z did.

One of the most ambitious and revolutionary projects in recent memory, the DAO raised more than $100M in Ethereum to build a decentralized venture fund.

Cota is the "Union" of the efforts of Ullas Naik (streamlined ventures) and Bobby Yazdani (signatures capital) they decided to structure their vehicle as a hedge Fund (as evidenced by their SEC form D).

One of the many vehicles tied to Tim Draper, Esprit (which was formerly called DFJ Esprit) is innovative in the fact that it actually IPOed on the London stock exchange.

137 is focused on investing in late stage companies by acquiring employee’s shares or lending against them. This is super smart as they get access to some extremely proven companies, at lower-than-market valuation, and can do so at any time, with small check sizes.

FundersClub is an online VC, as in they’re using network effects to run a centralized yet community-driven VC firm.

Unshackled is a super-smart arbitrage play. They market towards all the people that are stuck with US work visas or want to get to the US. 

In exchange for equity, Unshackled not only provides cash but also acts as an employer and visa sponsor for founders. That’s gotta be genius.

The studio model has fascinated me for quite a while. But more and more hybrid examples are launching. One of the newest interesting hybrids is Expa, which couples it studio activity with its venture investing and also acceleration program.

The scout initiative was a really well played move, that’s been used by countless other Vcs with varying degrees of success as we speak. If you’re exploring alternative and innovative models, you can find me on Twitter here or via Email.