Worth The Wait: Midas Newcomers Invested Early In Startups And Scored Big Wins In The Long Run

Worth The Wait: Midas Newcomers Invested Early In Startups And Scored Big Wins In The Long Run

Investors debuting on the 2023 Midas list saw their early bets made decades ago come to fruition in recent years.

By Rashi Shrivastava, Forbes Staff

For 37-year-old Lauren Kolodny, making the right investment isn’t just about the right numbers, but about the right thesis. One of her first opportunities came in 2015. Kolodny, who had just entered the world of venture capital through the doors of Aspect Ventures, was eager to make her first impactful bet. She knew millennials were entering the workforce in droves but still living paycheck to paycheck. That’s in part because they were still reeling from stock sell-offs and other financial headwinds that hit the economy that year, which made them distrustful of legacy banks and open to alternatives.

That’s when she was introduced to fintech startup Chime. The app, which provides online banking services, fell perfectly into her thesis and was made for strenuous financial times. Its accounts had no monthly or overdraft fees and users could get their paycheck two days in advance. In April 2016, Kolodny led a Series A round into Chime that valued the fintech startup at $34 million. Today, Chime is valued at $25 billion and has millions of users.

Now, as an investor and founding partner at Acrew Capital, Kolodny says she has one goal: she wants people and businesses to be free from financial struggles. “One of the greatest stressors in life for humans is money,” she says.

With this focus on fintech, she has written checks to 21 startups like fertility financing platform Future Family and Creative Juice, a startup which provides banking services and business tools like tax help to creators. Kolodny was also early to spot payroll and HR software provider Gusto in 2016, which today has a valuation of $9.6 billion. Other companies in her portfolio include Mexican banking services provider Klar, which was last valued at $500 million and Branch, a $4 billion startup focused on providing gig workers and deskless workforce with free digital wallets, cashless tips and paychecks.

This year Kolodny debuts on the Midas list, Forbes’ annual compilation of the top venture capitalists in the world, with six other newcomers. That’s less than half of the 15 newcomers that made it to last year’s Midas list, largely due to tumbling startup valuations and fewer exits in 2022.

Investors who did secure a spot this year have used the tried and tested tactic of making small and early bets in startups that have yielded substantial returns years or even decades after the initial investment. Despite the long wait to see returns, these Midas newcomers have stuck with founders throughout multiple funding rounds from seed till exit.

The Midas List 2023

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This Midas List Comes To Investors Who Wait

One of those patient investors who’s new to the list this year is Laurel Bowden. She’s one of four partners at venture firm 83 North, which manages $2.2 billion in assets across Europe and Israel. She says her investments depend on how interesting a sector is to her and how well she can understand its underlying mechanisms.

“People have brought me fashion things over the years. And fashion is clearly a hugely interesting area, but I’m not interested. If you saw my wardrobe, you’d know what I mean,” the London-based investor tells Forbes.

Among the startups that did catch her attention was data processing company Celonis, which reached a valuation of $13 billion in August 2022. Bowden co-led the German startup’s $27 million series A round seven years ago and has participated in every round since. In 2019, she led a $30 million Series B round into Finland-based food delivery Wolt that amassed returns for the firm when it was acquired by DoorDash for $8.1 billion in 2021.

Unusually for the VC business, Bowden typically only makes one investment a year. 83 North is in no rush to make multiple deals a year, she says, which allows her to work with founders for several years and meet the next cohort of entrepreneurs to invest in through them. “We are long-term investors. Some of our best companies have taken, you know, 12-13 years to exit,” she says.

Kindred Ventures cofounder Steve Jang says he has faced a similar wait. In 2009, while Jang was building his own song sharing startup SoundTracking (later acquired by Rhapsody), he invested in Uber as an angel investor and advisor. That was back when Uber was a side project in the prototyping phase, he says. The ride-hailing giant IPO’ed ten years later at a $82 billion valuation. “I still help out Uber even though the management team is almost completely different from the management team that I was friends with,” he says.

Jang, who immigrated from South Korea to the U.S. as a child, has also financed Postmates, which was acquired by Uber Eats in 2020 for $2.65 billion. In 2015, he invested in Coinbase, which went public in 2021 with an $86 billion market cap. “Our goal is to always be very, very early,” he says.

Another newcomer to the list is Topher Conway, who hails from long-term venture fund SV Angel, which was founded 30 years ago by his father, Ron Conway, and has backed giants like Google, Twitter and Airbnb. Topher serves as managing partner at SVA and has been doing investment deals since 2009. Highlights from his investment portfolio include his 2017 round into employee management platform Rippling (last valued at $11.7 billion) and his 2015 seed investment into supply chain management platform Flexport (worth $8 billion today).

This year’s list features the cofounder of the first Black-led VC firm to reach $1 billion in assets under management. In March 2021, Adeyemi Ajao, managing partner of Base10 partners, invested in Brazil-based fintech company Nubank, which was valued at roughly $42 billion when it IPO’ed in December 2021 and currently has 80 million customers. Ajao has also backed collaborative design application Figma, which Adobe is planning to buy for $20 billion if regulators approve the deal.

Shanghai-based investor David Su is making his first appearance on the list thanks to his investment into Chinese search engine Baidu, which has a market cap of $41 billion. David Singer, another newcomer to Midas, invested in primary care provider One Medical, which was acquired by Amazon for $3.9 billion in February 2023. Singer, a three-time entrepreneur, has also financed Korea’s largest e-commerce retailer, Coupang, which IPO’ed in 2021 at a $102.2 billion market cap. Singer made both those investments back in 2011 at their nascent stages and says that at Maverick Ventures, investors have always focused on seed rounds, which he calls “old school venture capital.”

“The venture business for a bit when money was free was a momentum business,” Singer says.”We see ourselves more as consistent company builders.”

Kenrick Cai contributed reporting.


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