Hustler Words – Brian Singerman, formerly a General Partner at Founders Fund, is teaming up with Lee Linden, co-founder and managing partner of Quiet Capital, to launch a new fund called GPx, aiming to raise over $500 million. Sources familiar with the strategy revealed to hustlerwords.com that Peter Thiel, a co-founder of Founders Fund, is expected to contribute a portion of the fund’s capital.
GPx is structured around a unique two-pronged investment approach. Approximately 20% of the fund will be allocated to emerging venture capital firms focused on pre-seed and seed-stage startups. The remaining capital will be used to co-lead later-stage (primarily Series B) investments in the most promising companies within these emerging managers’ portfolios.
This model diverges significantly from the conventional venture capital approach, where firms typically invest directly into startups. GPx incorporates elements of a fund-of-funds model, a less prevalent strategy where capital is invested in a portfolio of other funds rather than directly in underlying assets. While fund-of-funds offer limited partners access to niche or exclusive firms, they often come with the drawback of layered fees.
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Despite a recent slump in capital raised by fund-of-funds firms, Singerman and Linden are confident that their established reputations, extensive networks, and the hybrid nature of their strategy will attract limited partners to GPx.
The rationale behind GPx’s strategy lies in the increasing concentration of venture capital within larger funds. This trend has led some of the most talented investors to leave established firms in favor of launching their own, more agile and specialized investment vehicles.
GPx aims to capitalize on this trend by backing the next generation of VC investors who are adept at identifying and supporting strong early-stage companies. This will allow GPx to co-lead later-stage investments in the emerging managers’ most successful portfolio companies.
A key advantage of GPx’s strategy is its ability to address the pro-rata challenges faced by early-stage VCs. These firms often struggle to maintain their ownership percentage in top-performing companies during later funding rounds due to limited fund sizes. While they may attempt to raise special purpose vehicles (SPVs), these processes can be time-consuming, potentially allowing other investors to seize coveted equity spots.
With GPx’s backing, emerging funds will have the opportunity to not only exercise their pro-rata rights but also lead later-stage rounds, solidifying their position in the most promising ventures.
The Information previously reported on the launch of GPx but did not disclose details regarding the fund’s target size and specific strategy elements.
Neither Singerman nor Linden have responded to requests for comment.
Editor’s note: This story has been updated to reflect Peter Thiel’s involvement with GPx.
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