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Exclusive: Lightspeed raises $7.1B across four funds and forms new crypto fund with Blockchain Ventures vet

July 12, 2022, 11:58 AM UTC

It was right as COVID was entering our vernacular that early-stage-focused venture firm Lightspeed Venture Partners raised $4 billion in funding. Now Lightspeed has gone back to market as the private markets stall once again. 

This time around, Lightspeed has raised $7.1 billion across three U.S. funds and an India fund—and it’s delving further into crypto as it launches a joint partnership with Blockchain Ventures co-founder Sam Harrison.

“If the opportunity has fundamentally changed, then the venture operating model can’t stay the same,” says Bejul Somaia, who leads Lightspeed’s investments in India, of raising billions of new capital right now—pointing out the rapid pace of high-growth companies being created in today’s market versus the last few decades.

Lightspeed has closed its fourteenth early-stage fund, with nearly $2 billion in assets, in addition to a $2.3 billion growth fund and a $2.4 billion fund for its international bets. Lightspeed India Partners also closed a $500 million early-stage fund. 

In total, Lightspeed has raised some 60% more than it did in its last funding round—a vote of confidence in the firm from its limited partners as valuations start to sink and one of its star senior partners, Jeremy Liew, who led the company’s investments in Snap, Affirm, and the Honest Company, has decided to take a step back from making new investments. 

Lightspeed is also digging its heels further into the crypto industry with a new joint venture, dubbed Lightspeed Faction. The new firm is an early-stage-focused crypto fund that will invest within each layer of the blockchain ecosystem—from infrastructure to applications. Lightspeed has partnered up with Sam Harrison, co-founder of Blockchain.com’s venture arm (where he will remain a venture partner), and Banafsheh Fathieh, an internet and blockchain investor formerly with Prosus Ventures.

Under this new strategy, Lightspeed, which was Blockchain Ventures’ largest limited partner, and Lightspeed Faction will operate as two separate investors, though they will share resources across teams as well as swap carry on their crypto investments (Harrison wouldn’t offer further specifics on the compensation arrangement). 

“We think the time is now,” Harrison says, noting that this is the time blockchain companies will start becoming formative businesses.

Lightspeed Faction declined to comment on its fundraising efforts, though an SEC filing from earlier this month indicates that Lightspeed Faction is raising capital from limited partners for its first fund. Sources familiar with the matter told Fortune that the new firm has raised $325 million in a first close for its debut fund, and is seeking up to $400 million in total. A Lightspeed spokeswoman declined to comment.

Excluding this new crypto initiative, Lightspeed’s new fundraise will hoist the firm’s assets under management to $18 billion.

Hello from the Maroon Bells. Good morning from Aspen, where we are chatting about when the IPO market will open back up (Hint: not very soon) and people moving out of Silicon Valley, as well as hiking our way through the mud. It’s been lovely to meet so many Term Sheet readers in person! A photo for good measure:

Jessica Mathews—Fortune

See you tomorrow,

Jessica Mathews
Twitter: @jessicakmathews
Email: jessica.mathews@fortune.com
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Jackson Fordyce curated the deals section of today’s newsletter.

VENTURE DEALS

- SingleOps, an Atlanta-based SaaS business management software, raised $74 million in funding from FTV Capital.

- Inspirna, a New York-based small molecule therapeutics developer, raised $50 million in Series D funding. Sands Capital and Vivo Capital led the round and were joined by investors including Dreavent 6, Novo Holdings, Sofinnova Capital, Sixty Degree Capital Fund, New York City Investment Fund, Lepu Holdings, and other angels. 

- Continuum, a Salt Lake City-based talent marketplace for executives, raised $12 million in Series A funding. Pelion Ventures led the round and was joined by investors including Uncork Capital, Day One Ventures, Divvy CEO Blake Murray, Superhuman co-founder Vivek Sodera, and other angels. 

- Asset Class, a Dublin-based investment management software solutions provider, raised $11.6 million in Series A funding. Canapi Ventures led the round and was joined by investors including Live Oak Ventures, Plexus Capital, and Total Technology Ventures.

- APDS, a New York-based career readiness platform for incarcerated individuals, raised $7 million in Series C funding co-led by ETS Strategic Capital and New Markets Venture Partners

- Spearhead, a London-based African spirits company, raised $3 million in funding from Pendulum.

- CleanO2 Carbon Capture Technologies, a Calgary, Canada-based carbon capture technology company, raised $2.75 million CAD ($2.12 million) in seed 2 funding. Regeneration.VC led the round and was joined by investors including Export Development Canada, Duke Street Investments, TIRI Group, and Local Investment YYC Cooperative.

- Gemini Sport Analytics, a Miami-based sports intelligence platform, raised $1.5 million in seed funding. Florida Funders, the Florida Institute, Ocean Azul Partners, leAD Sports & Health Tech Partners, and others invested in the round. 

PRIVATE EQUITY

- Partners Group acquired a majority stake in Budderfly, a Shelton, Conn.-based energy management startup, for more than $500 million. 

- Clearhaven Partners acquired a majority stake in SundaySky, a New York-based SaaS platform for video creation and personalization, for more than $100 million. 

- JDH Capital acquired Pure Archery, a Eugene, Ore.-based archery products maker. Financial terms were not disclosed.

- OMERS Private Equity agreed to acquire Network Plus, a Manchester, U.K.-based utility and infrastructure repair and maintenance service provider. Financial terms were not disclosed. 

- SVPGlobal acquired Deucalion Aviation, a London-based aircraft asset management, financing, and investment solutions provider. Financial terms were not disclosed.

EXITS

- MidOcean acquired Pragmatic Institute, a Phoenix-based management training firm, from Renovus Capital Partners. Financial terms were not disclosed. 

OTHER

- Innoviva agreed to acquire La Jolla Pharmaceuticals, a Waltham, Mass.-based pharmaceutical company focused on life-threatening diseases. A deal is valued at approximately $149 million.

- Prodege acquired AdGate Media, a Manhasset, N.Y.-based digital advertising company. Financial terms were not disclosed. 

- Syntellis Performance Solutions agreed to acquire Stratasan, a Nashville-based health care market intelligence and data analytics provider. Financial terms were not disclosed.

FUNDS + FUNDS OF FUNDS

- Cinven, a London-based private equity firm, raised $1.5 billion for a fund focused on insurance, reinsurance, asset-backed specialty finance, wealth management, insurance distribution, and other industries.

PEOPLE

- Energize Ventures, a Chicago-based alternative investment manager, hired Adam Katz as head of legal, Honour Masters as senior investment associate, and Hannah Magnuson as content marketing strategist. The firm also promoted Katie McClain to chief operating officer. Formerly, Katz was with Golub Capital, Masters was with Union Square Ventures, and Magnuson was with APTIM

- Goanna Capital, a Palm Beach, Fla.-based alternative asset management firm, hired Emily Hufnagel as an analyst. Formerly, she was with Ernst & Young.

- Starting Line, a Chicago-based venture capital fund, promoted Scott Holloway to general partner. 

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