High Alpha Launches Third Venture Studio

High Alpha, a venture studio, announced the launch of its third studio on Wednesday. This initiative continues the firm’s strategy of building, launching, and scaling enterprise cloud-based businesses.

A Unique Entrepreneurial Model

The Indianapolis-based company typically initiates a new studio every three years. This approach represents a distinctive model of entrepreneurship, integrating startup creation with substantial venture funding.

Navigating a Competitive Venture Capital Landscape

Co-founder and Managing Partner Scott Dorsey explained to TechCrunch that this launch occurs during a particularly active period for venture capital investment. He noted that venture firms are increasingly compelled to engage earlier in the process to secure promising deals.

“The current venture market is exceptionally dynamic,” Dorsey stated. “Firms are needing to act proactively to remain competitive. Our venture studio model positions us favorably, as we operate at a very early stage.”

Empathy and Operational Expertise

Dorsey emphasized the value of High Alpha’s hands-on experience. The firm not only navigates the challenges of launching companies but also possesses a deep understanding of the operational aspects involved.

“We have the empathy and operator background that many firms lack,” he added. “This allows us to effectively support our portfolio companies.”

Expanding Opportunities for Seed Investors

The increased activity in the venture capital space is viewed as a positive development, broadening the landscape for seed investors. A greater number of firms are now capable of providing significant funding.

Consequently, if High Alpha can successfully establish companies within the first year, those startups will be well-positioned to secure the necessary capital for subsequent growth phases.

Securing Funding for Studio III

High Alpha Studio III has secured $18 million in funding from existing investors Emergence Capital and Foundry Group. This investment follows a $110 million fund announcement made seven months prior.

As part of this funding round, Jaclyn Freeman Hester of Foundry Group and Carlotta Siniscalco of Emergence Capital have joined High Alpha’s board of directors.

High Alpha’s Track Record

Founded in 2015 by Dorsey, Eric Tobias, Mike Fitzgerald, and Kristian Andersen, High Alpha has raised over $260 million to date. The firm has successfully founded and launched over 30 companies.

Portfolio Companies and Exits

Notable companies within the High Alpha portfolio include Zylo, Lessonly, MetaCX, Mandolin, Casted, and Bolster. The first studio produced 11 companies, while the second generated 17.

Currently, the new studio is initiating operations with three companies, two of which are operating in stealth mode. To date, seven companies from across all studios have achieved successful exits, including the recent acquisition of Lessonly by Seismic.

Adapting to the Evolving Workplace

Over the years, High Alpha has explored various sectors, including the gig economy and the talent marketplace. The shift in work patterns in 2020 prompted the firm to accelerate its company creation efforts.

“We identified an opportunity to address the challenges presented by the evolving work landscape,” Dorsey explained. “We are operating in a fundamentally new environment.”

Increased Funding for Greater Impact

Dorsey concluded by stating that increased funding will enable High Alpha to make more substantial investments and effectively compete within the market.