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Today’s news of a $1.4 million seed round for ThredUP Inc. is a first point on the map for Nextview Ventures – the new seed-stage investing effort of VCs David Beisel, Rob Go and Lee Hower.
Mass High Tech broke the news of the trio’s collaboration in May, but so far, the three have said little about their investment strategy. Go is a former senior associate at Spark Capital in Boston. Hower is a former principal at Point Judith Ventures in Providence, R.I. Beisel is still a vice president at Venrock, a firm with offices in Cambridge, New York and San Francisco.
ThredUP founder James Reinhart said it was Beisel’s presence that made Nextview stand out from other early-stage investors the company talked to. “The fact that he has some big fund experience, but also is able to see what it takes to grow companies from the fund perspective is really helpful,” Reinhart said, citing Beisel’s experience on the board of Venrock portfolio company Second Rotation Inc., a Boston consumer electronics resale and recycling company. “Some of the other micro-VCs that haven’t been around growing companies from the fund perspective.”
Nextview’s website doesn’t say much about the new firm, except that it will focus on “Internet-enabled businesses.” Go declined to comment for the story beyond saying that ThredUP is not Nextview’s first investment. He declined to name the firm’s other deals.
ThredUP’s other three investors are Founder Collective, an early-stage-focused VC firm with offices in Cambridge and New York, Trinity Ventures, a Menlo Park, Calif. firm with over two decades experience in early-stage investing, and High Line Ventures, a new spin-off from New York-based Internet company IAC (Nasdaq: IACI) .
Trinity’s Patricia Nakache will take a seat on ThredUP’s board – the only board representative from any of the four firms syndicated in the round.
Founder Collective has stated it will not seek to reinvest in its portfolio companies’ later rounds of venture financing, preferring to focus on capital-efficient companies whose fast time to exit can preserve equity for early-stage investors.
Reinhard said ThredUP, which provides an online childrens’ clothes-swapping service for parents, is pursuing a capital-efficient strategy, keeping hires few and relying on word-of-mouth and viral marketing to grow. “This doesn’t need to get that big,” he said. “We’re going with the horses we have and adding some new folks in where we can.”
Those additions to the company’s currrent eight-person team will likely include a few engineers, and a customer acquisition expert with a few startups under his or her belt.
From there, Reinhart believes the company will grow slowly until it reaches an inflection point where potential users are hearing from two or three of their friends about the service. At that point, new venture capital infusions may be needed to grow quickly, he said – another factor that made Beisel valuable in the startup’s first venture round. “Dave was able to think about how does this round relates to the next round,” he said.
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