BoxGroup, First Investor in Fintech Unicorn Plaid, to Close $255 Million Across Two VC Funds

By Adriaan Brits | Monday, 02 August 2021 | Finance, Startup, Tech

BoxGroup, a New York-based early-stage investment fund focused on tech companies, announced today it is closing in on two venture capital (VC) funds for young startup companies.

Providing Funding for Early-Stage and Second Chance Startup Companies

BoxGroup is set to close its fifth early-stage fund designed for tech startup companies looking for backing at a pre-seed or seed business funding round. Fund V is valued at $127.5 million, the same as the company’s second fund, which focused on startup companies seeking business funding in their subsequent follow-up rounds.

The VC business is looking to provide funding ranging between $250,000 and $1 million to between 40 and 50 startup companies. According to BoxGroup partner David Tisch, the aim is to be “the second or third biggest check in a round.”

The second chance fund will simply provide additional funding to startup companies in which BoxGroup previously invested. Furthermore, the VC company doesn’t exclude investing in later-stage startup companies through its second opportunity fund. 

“If you’re starting a company and you’re going to raise money, that first yes is the hardest. And it’s that’s the one that gives you the confidence, the excitement – to know that there’s somebody out there that’s going to believe in this and give you money for it. We really do try to pride ourselves on being that first yes on a regular basis. So the earlier we meet companies, the better,” Tisch added.

The VC company has made more than 300 startup investments so far, including Ro, Airtable, Workrise, Scopely, Bowery Farms, Ramp, Titan, Warby Parker, Classpass, Guideline, and Glossier. Most notably, BoxGroup acted as a first investor in the fintech business giant Plaid, which was valued in excess of $13 billion in April.

Interestingly, BoxGroup has accepted external capital for the first time in nine years, with funding secured exclusively through personal capital since 2012. The VC business has already made a number of successful exits from previous early-stage business investments, including Flatiron Health, PillPack, Matterport, Oscar, Mirror, Bark, Bread, and Trello. 

Hence, BoxGroup is looking to offer more funding for young startup companies using its new war chest. Similarly to Plaid, the VC company also acted as the first investor in the online pharmacy startup PillPack. Pillpack was sold later to Amazon in a business deal worth almost $1 billion. 

As for digital healthcare startup Ro, BoxGroup took part in every business round, including the latest that valued the startup at $5 billion. This investment represents a classic BoxGroup story, coming in early and maintaining an authentic relationship with founders.

“This cannot be transactional, it has to be personal. We want to go on a journey with someone for a decade as they build their business…. We’re comfortable with what early means, including a lot of assumptions, more vision than traction, and raw product,” says partner Nimi Katragadda.

New funding will also allow the company, which has offices in San Francisco and New York, to grow and hire more “first-line investors.”

Summary

BoxGroup, an early investor in Plaid, Ro, and PillPack, announced it is closing in on two new funds worth $255 million combined. Half of these funds will be available for early-stage startup companies, while the other half will be for the second chance fund.

About the Author

Adriaan Brits

As an analyst of global affairs, Adriaan has an MSC from Oxford, with diverse interests in the digital economy, entertainment, and business. He is a specialist trainer in Advanced Analytics & Media.