Root Ventures, a San Francisco-based venture firm that closed its debut fund with $30 million 2015, has raised a second fund, closing it with $76.7269 million dollars in capital commitments. Why? Because Root is proudly comprised of engineering nerds, and 767.269 miles per hour is the speed of sound. In dry air. At 20 degrees Celsius.
Of course, more mathematically significant to its investors is how the firm is faring, and on that front, Root’s backers must like what they see.
Though Root’s investments are mostly too new to judge yet — its debut fund took stakes in 27 companies — it can easily back up claims that it invests in “deeply technical founders” who are tackling “interdisciplinary engineering problems,” including in robotics, machine learning, and software for physical industries.
Among Root’s many interesting bets to date: Creator, a hamburger-making robot that can craft a burger from start to finish in five minutes; Nautilus Labs, which sells machine learning-based analytics to maritime shipping companies, including to help them reduce their fuel costs; NordSense, whose ultra low-cost sensors sit inside garbage bins to monitor how full they are; and Wild Type, a young startup focused on creating lab-grown meat.
Firm cofounder Avidan Ross tells us that with the firm’s new fund, he and investing partners Chrissy Meyer and Kane Hsieh will be writing slightly larger initial checks, ranging from $1 million to $2 million, up from the $500,000 checks it was writing with its first fund. He adds that the firm plans to stay firmly rooted (ahem) to its mission of supporting seed-stage founders whose companies may ultimately require a lot of resources, yet who Root can help because of its collective engineering and investing muscle.
Ross is himself a trained engineer who was previously CTO of the private equity firm CIM Group. Meyer was an engineering program manager at both Apple and Square before becoming the director of hardware product development at Pearl Automation. (The three-year-old company was founded by numerous Apple employees and set out to make automotive back-up cameras, but it shut down last year.)
Meanwhile, Hsieh, who studied computer science at Harvard, spent a couple of years as a senior associate with RRE Ventures in New York before cofounding a bike company focused on low cost and high design. Then, shortly after Root was founded, Ross talked him into joining. “Kane is obsessed with optimization and automation,” says Ross.
Root has seen a few exits already, among them Preact, a cloud-based platform and service aimed at helping subscription-model businesses reduce churn; it was acquired for undisclosed terms by Spotify in late 2016. Root also saw Cape Networks, a startup that used sensors to provide service assurance and test network and application performance, sell to Hewlett Packard Enterprise earlier this year for undisclosed terms.
As for its investors, like most venture firms, Root doesn’t discuss these. Still, we’re aware that one of Root’s backers, in both its first and second vehicles, is the fund of funds manager Cendana Capital, based in San Francisco.
Cendana has been an early investor in many promising seed-stage firms, some that have since graduated from Cendana’s sweet spot, which is groups that raise sub $100 million funds. Some of its other investments over the years have included Forerunner Ventures, Uncork Capital, Bolt, Notation Capital, and IA Ventures.