MaC Venture Capital Closes $103 Million Inaugural Fund

The partners at MaC Venture Capital, a Los Angeles-based investment firm, have recently finalized a $103 million fund for their initial investment cycle. Throughout their careers, these partners have consistently challenged existing norms and broken down barriers within their respective fields.

Formation and Core Principles

MaC Venture Capital was established through the collaboration of several prominent figures. These include M Ventures, founded by former Washington, DC mayor Adrian Fenty; Charles D. King, the first Black partner at a major Hollywood talent agency; and Michael Palank, a seasoned operating executive and former agent. They joined forces with Marlon Nichols, a co-founder of Cross Culture Capital, an LA-based investment firm.

The firm’s objective was to establish a fund operating under a distinct philosophy. It blends Fenty’s expertise in software investment, gained during his time as a special advisor to Andreessen Horowitz, with Nichols’ focus on sectors undergoing transformation due to evolving consumer behavior and demographics.

A History of Collaboration

“A significant history and network of relationships underpin this venture,” stated King, a leading figure in Hollywood and the founder of Macro. “Adrian and I first connected in 1993 while attending law school.” He continued, “We both pursued successful paths, with him entering public service in Washington, DC, and me becoming a senior partner at WME.”

Palank’s connection to the team stemmed from his prior work with King at William Morris, where they collaborated before Palank managed business development for prominent clients like Will Smith.

King explained, “The initial concept revolved around bridging the gap between technology and innovation. This led to the formation of M Ventures, but the understanding of media and culture complemented Marlon’s work at Cross Culture.”

Merging Culture and Technology

MaC VC uniquely aims to integrate seemingly disparate cultural forces. This includes the impact of early hip-hop pioneers like DJ Herc and the revolutionary invention of the internet by Sir Tim Berners-Lee.

While the founding partners prioritize showcasing the financial successes of their firms and portfolio companies – including Stoke, Goodfair, Finesse, PureStream, and Sote – the significance of a general partnership comprised of three Black men securing $103 million in an industry facing diversity challenges cannot be overstated.

Investor Confidence and Diversity

“Our limited partners invested in us for numerous reasons, with our diverse team being a primary factor,” Fenty noted. “We will present them with companies they likely wouldn’t encounter through other venture funds.”

He further emphasized their commitment to diversity, stating, “We maintain the same investment criteria, actively seeking women, African American, and Latino founders. Our current portfolio includes companies led entirely by these demographics.”

The firm’s values are reflected in its diverse group of limited partners, which includes Goldman Sachs, the University of Michigan, Howard University, Mitch and Freada Kapor, Foot Locker, and Greenspring Associates.

Strategic Vision and Portfolio Growth

Daniel Feder, managing director with the University of Michigan Investment Office, stated, “We are pleased to support MaC Venture Capital in establishing a new venture capital model centered on cultural investment and supporting innovative companies and founders.” He added, “Their combined expertise in technology, media, entertainment, and government, coupled with their investment record, provides valuable insights into evolving cultural trends.”

The firm’s portfolio encompasses startups located globally, from Seattle and Houston to Los Angeles and Nairobi.

Fenty clarified, “We consider opportunities across all sectors and maintain a generalist approach.”

Focus on Emerging Technologies

A strong emphasis on software-driven businesses is complemented by a thesis-driven strategy. This strategy is outlined in position papers predicting the impact of gaming, conscious consumerism, evolving parenting styles, and demographic shifts on the global economy.

The firm is also expanding into frontier technologies, including the space industry, mixed reality, and the convergence of computing with the physical world. This is partly influenced by the thriving tech ecosystem in Los Angeles. Palank observed, “We’re witnessing entrepreneurs emerging from companies like SpaceX and Tesla, bringing top-tier experience.” He added, “LA now graduates more computer science students annually than Northern California.”

Early indicators suggest the venture firm is performing in the top 5% of funds, with initial investments yielding a 3x return, according to Nichols.

Nichols concluded, “MaC represents a natural progression of our previous work. We remain committed to the belief that talent is abundant, but access to capital and opportunity is not. We aim to be a primary source of capital for those founders.”