Seed-Stage VC Chicago Ventures Closes $63 Million Fund

While large funding rounds and initial public offerings frequently capture public attention, it’s important to remember that many successful companies began as early-stage ventures seeking initial seed funding.

Chicago Ventures, a venture capital firm specializing in seed-stage investments, has recently announced the final closing of its third fund. This new vehicle totals $63 million and has already been actively deployed into promising startups.

Fund Strategy and Investment Criteria

Based in Chicago, the firm maintains a focused investment approach. Chicago Ventures typically leads seed rounds, rather than simply participating in them. The fund aims to make 25 investments, with each company receiving an average check size ranging from $1.5 million to $2 million.

To date, the firm has invested in 11 companies from this fund, leading the initial funding round for 10 of them. These portfolio companies include CognitOps, CoPilot, Forager, Interior Define, NOCD, OneRail, PreFix, and Ureeka.

Geographic Focus: Beyond Silicon Valley and New York

Chicago Ventures actively seeks out companies located outside of the traditional tech hubs of Silicon Valley and New York City. A significant portion of their recent investments have been concentrated in emerging tech ecosystems.

Specifically, six of their latest investments are in Chicago-based startups. Two are located in Austin, Texas, where the firm recently established an office. Additional investments were made in Orlando, Florida, and Los Angeles, California.

Identifying Undervalued Opportunities

The firm distinguishes itself by focusing on identifying and supporting companies that may be “overlooked” by other investors. Founded in 2012, Chicago Ventures operates on the belief that strong, lasting companies can be built in diverse locations, not solely within a limited geographic area.

“Leading seed rounds is a relatively uncommon practice; most funds prefer to follow other investors,” stated the firm. “Innovation often receives disproportionate attention in established tech centers. We aim to bridge these gaps, providing early leadership and hands-on support to companies during their formative stages, and investing in areas beyond the coasts.”

Portfolio Success and Past Performance

Since its founding, the firm’s portfolio companies have collectively secured over $1.5 billion in subsequent funding rounds. Currently, seventeen companies within the portfolio are valued at over $100 million, including Cameo, the business software marketplace G2, and logistics software provider project44.

Chicago Ventures previously closed its second fund in 2016, comprising a $60 million main fund and a $6 million sidecar fund. For this latest fund, the firm opted not to include a sidecar component.

New Partner Announcements

Alongside the fund announcement, Chicago Ventures revealed the promotions of Peter Christman and Lindsay Knight to the position of Partner. Christman focuses on investments in companies modernizing traditional enterprise systems and consumer products that improve access to healthcare and financial services.

Knight oversees the firm’s post-investment operational support, encompassing talent acquisition, business development, and the sharing of industry best practices.

Additionally, Jackie DiMonte has joined the team as a new Partner. DiMonte brings experience from Hyde Park Venture Partners, where she specialized in early-stage enterprise investments. As an engineer, she will be based in Austin, a city where Chicago Ventures has made 10 investments since 2015.

Recent trends in seed-stage funding were previously examined by TechCrunch, as detailed in this article. Despite economic uncertainties, the trend of increasing average seed-check sizes has persisted.