Venture capital firm Vesey Ventures announced the raising of its first fund today, amounting to $78 million. The firm says that it will focus on early-stage investment in fintech and on technology companies in cyber, AI and data that sell to the financial services industry.
The founders of the firm are three former managing directors of American Express’s investment arm Amex Ventures: Dana Eli-Lorch, who will head the firm’s Israel team, Lindsay Fitzgerald, and Julia Huang.
"Globes" has learned that Synchrony Financial (NYSE: SYF) is one of the strategic investors in the fund. The company, which has a market cap of $12.9 billion, describes itself as the largest provider of private-label credit cards in the US.
"Our investor base is a combination of institutions and private investors, and includes founders of leading fintech companies, senior executives in the finance industry, and leading financial institutions" Eli-Lorch told "Globes". "Unlike other funds, we don’t have hundreds of strategic investors. We know each and every one of them, and we know how to sift opportunities in the best possible way in accordance with their particular priorities. We consciously chose to build Vesey Ventures in that way."
As mentioned, the firm has raised $78 million from its various limited partners, but the partners refuse to comment on the question of the original target for the fund and whether it matches the amount now reported. Nevertheless, Eli-Lorch does comment on the current economic situation, saying, "The market situation dictates money raising targets, and not only did we raise a substantial mount of money in this economic environment, we also raised the amount we needed in order to implement our investment strategy. We are proud of the sum of $78 million and see it as evidence of our network, reputation and record as a proven team offering something special on the landscape."
Nevertheless, the three stress that they raised a substantially higher amount than the size of the average venture capital fund, which is $50 million according to November figures from PitchBook, and that it is higher than the aggregate $74 million raised by all female-led venture capital funds together this year. The fund was raised in 2022, before the current government in Israel came to power, so that there is no connection between the amount raised and the current situation in Israel.
"Israel becoming a fintech power
The firm’s offices are located in New York and Tel Aviv. The partners seek to provide startups with the tools to collaborate and to expand to the US market. The firm’s announcement states that to the term sheet that it offers its portfolio companies it will attach a "strategy sheet," setting out how it will leverage its network "to act as a company’s first business development team."
According to its announcement, the fund has already invested in several companies in the US and in two Israeli companies: Grain, and Cyrus.
The three partners have a record of investment in over 60 successful companies over the past decade, among them Stripe, Plaid, Toast, Melio, Trulioo, Signifyd, iZettle, FalconX, Menlo Security, BioCatch, and Codat.
"We have very great faith in Israel entrepreneurs and talent and in the strong ecosystem. This is also the reason that I returned to Israel a few years ago after eight years in the US, and that we set up a fund that has teams both in New York and in Tel Aviv. We very much hope that changes won’t be made that will adversely affect the Israeli economy and the business environment and that will endanger what has been built here with hard work over so many years," Eli-Lorch said.
"What happened in Israel in the cyber industry has been happening in fintech in the past few years," she added. "Israel is becoming a power in the field, with a great deal of know-how and experience. Just as it is clear that investors in cyber cannot ignore Israel, Israeli fintech too is becoming a global consensus that cannot be ignored."
Published by Globes, Israel business news - en.globes.co.il - on April 20, 2023.
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