The Brooklyn Navy Yard is a microcosm of New York history. First established by President John Adams in 1801, the grounds birthed the ship that lay the first undersea telegraph cable and the ironclad USS Monitor during the Civil War. The Yard swelled to a peak of 70,000 workers during World War II before Secretary of Defense Robert McNamara closed it in 1966, with all remaining shipbuilders laid off by the next decade. After fits and starts, the area saw a rebirth under Mayor Bloomberg. Today, it’s home to a state-of-the-art movie studio complex, the city’s oldest whiskey distillery, and the technology center Newlab.
Newlab is hard to describe. It’s a venture investor across a variety of what it describes as “critical technology” sectors, such as energy and mobility. It’s what a WeWork might look like if Adam Neumann were handy—a massive space for startups complete with carpentry workshops, science labs, and 3D printing rooms. And it’s a consulting business that helps companies like Verizon commercialize moonshot ideas.
If you’re confused, that’s ok. It took me an hour-long tour of Newlab’s Brooklyn Navy Yard hub, which opened in 2016, to start to understand the setup (The parent company has replicated the model in Detroit, Uruguay, and as of January, Saudi Arabia.)
The sprawling facilities are spread across an 84,000-square-foot hangar. They buzzed with activity when I visited last Wednesday morning, housing dozens of startups working on everything from food robotics that can select the proper items on an assembly line to reactors that convert ammonia into power (the latter, a startup called Amogy, grew out of Newlab and has raised over $270 million). There’s even a cafe open 24/7.
Brandon Corts, Newlab’s head of startup pipeline and director of ventures, described the coworking setup as a loss leader. The idea is to combine labs, office space, and community to attract startups working on difficult, often physical problems. He bragged that Newlab is the only place in New York City where engineers can pilot autonomous vehicles. It’s even been the site of rocket engine tests. “This side of the system gives me the infrastructure to test the startup technology and a reason for startups to be talking to me in the first place,” he said. The Brooklyn hub alone has hosted nearly 500 startups that have collectively raised over $4 billion.
Even so, Newlab will only invest in about 10% of the startups it houses, selectively deploying capital from first checks through Series A. Some come in through an application process before Newlab ever invests, like Amogy, which was started by MIT PhDs. Others come in through fellowship programs, like Project B, a startup that turns body scans into 3D-printed clothing using a zero-waste process, with all manufacturing in the U.S. (They’re currently focused on making custom-sized bras.) The two founders started building the company at Cornell Tech and came to Newlab through a partnership between Bank of America and the New York City Economic Development Corporation.
I sat down with Garrett Winther, Newlab’s chief venture officer, who explained the organization’s unique funding structure. Newlab hasn’t raised any dedicated venture funds, instead investing from balance sheet capital mostly generated from projects with larger corporations and governments, where Newlab acts as an advisor. He said that almost half of the pilots they work on reach the commercial stage, like a partnership with Verizon on 5G applications.
“We’re able to generate enough profits for us to reinvest in the company,” Winther explained. Newlab also puts together special-purpose vehicles with different investors, including high-net-worth individuals and corporate venture funds, for specific projects.
Riyadh is Newlab’s latest expansion, where the focus area will be physical mining, with hefty support from the government (“All our expansions are underpinned by significant public and private partnerships,” Winther told me.) It’s set to be the first of many.
While Newlab’s Riyadh site is built in new facilities, they’re proud that their Brooklyn (and Detroit) locations are housed in former industrial centers, newly imagined for a different age of technology. The rebirth embodies the company’s ethos. “How do you actually make these essential challenges more addressable by entrepreneurs?” Winther said. “We’ve created this entire venture platform around lowering the barriers to these seemingly more complex problems.”
Scooplet…According to filings with the Securities and Exchange Commission, the North Carolina-based alternative asset management firm TrueBridge appears to be raising a second blockchain-focused venture fund with a target of $200 million. According to the filings, TrueBridge has not yet raised any capital, though that could exclude investor commitments. TrueBridge announced $1.6 billion across five venture vehicles back in May, including a final close of $62 million for its first dedicated blockchain fund—a sign of crypto’s resurgence. Edwin Poston, TrueBridge’s cofounding general partner, did not respond to a request for comment. (TrueBridge is also the data partner on Forbes’ Midas List.)
Leo Schwartz
X: @leomschwartz
Email: leo.schwartz@fortune.com
Submit a deal for the Term Sheet newsletter here.
Nina Ajemian curated the deals section of today’s newsletter. Subscribe here.
VENTURE DEALS
- Prosper, a London-based wealth management platform, raised £4 million ($4.9 million) in funding. Fuel Ventures led the round and was joined by The Players Fund, Cody Gakpo, and others.
- GOAT Gaming, a Singapore-based gaming platform for Telegram, raised $4 million in funding from TON Ventures, Karatage, Amber, and Bitscale.
- OneThird, a Enschede, The Netherlands-based AI-powered food waste solutions provider, raised €3.5 million ($3.6 million) in Series A funding. Invest International led the round and was joined by existing investors Pymwymic, SHIFT Invest, and Oost NL.
PRIVATE EQUITY
- CIVC Partners acquired a majority stake in Strategus, a Englewood, Colo.-based CTV advertising company. Financial terms were not disclosed.
OTHER
- Itaú Unibanco acquired a minority stake in Kanastra, a Uberlândia, Brazil-based financial services provider for funds and securitizations, in a Series A extension. Financial terms were not disclosed.
IPOS
- Metsera, a New York City-based obesity treatment developer, raised $275 million in an offering of 15.3 million shares priced at $18 on the Nasdaq. ARCH Venture Partners, Population Health Partners, FMR, GV, MC Longevity, Newpath Partners, and SoftBank back the company.
- Infinity Natural Resources, a Morgantown, W.V.-based oil and natural gas producer, raised $265 million in an offering of 13.3 million shares priced at $20 on the NYSE. The company posted $221 million in revenue for the year ending June 30, 2024. Pearl Energy Investments and NGP Capital back the company.
- Maze Therapeutics, a South San Francisco-based renal, cardiovascular, and metabolic diseases precision medicine developer, raised $140 million in an offering of 8.8 million shares priced at $16 on the Nasdaq. The company posted $168 million in license revenue for the year ending Sept. 30, 2024. ARCH Venture Partners, GV, Third Rock Ventures, Matrix Capital Management, and Foresite Capital back the company.
FUNDS + FUNDS OF FUNDS
- Petra Capital Partners, a Nashville-based private equity firm, raised $270 million for its fifth fund focused on healthcare, business, and technology-enabled services providers.
PEOPLE
- Conviction, a San Francisco-based venture capital firm, added Mike Vernal as a general partner. Previously, he was at Sequoia Capital.
- Felicis, a Menlo Park, Calif.-based venture capital firm, added Peter Deng as a general partner. Previously, he was at OpenAI.
- Petra Capital Partners, a Nashville-based private equity firm, promoted Matt Sotelo to partner.