TL;DR
A* Capital, founded by Kevin Hartz, has closed its third fund with $450 million. The fund aims to back at least 30 startups in AI, fintech, healthcare, and security over the next two to three years. This marks continued growth for the firm and highlights investor confidence in its strategy.
A* Capital, the early-stage venture firm founded by Kevin Hartz, has closed its third fund with $450 million in committed capital, marking a significant milestone for the firm as it continues to expand its investment activities across various technology sectors.
The new fund, Fund III, was announced on Tuesday and will deploy capital over the next two to three years. The firm plans to make at least 30 investments with check sizes ranging from $3 million to $5 million. Limited partners include nonprofits, foundations, endowments, and notable backers such as Carnegie Mellon University.
Kevin Hartz, a serial entrepreneur known for co-founding Xoom and Eventbrite, leads A* Capital along with Bennet Siegel. The firm previously raised a $315 million Fund II in 2024 and a $300 million Fund I in 2021. A* Capital’s investment approach is generalist, supporting startups in AI, fintech, healthcare, and security, among other categories.
Why It Matters
This development underscores investor confidence in A* Capital’s strategy and track record, especially as the firm continues to back early-stage companies with a focus on innovative sectors. The sizable fund size and the firm’s backing by prominent institutions suggest a strong position within the venture capital landscape, potentially influencing funding trends for startups across multiple industries.
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Background
Founded in 2020, A* Capital has quickly established itself as a notable player in early-stage venture investing. Kevin Hartz’s previous successes with Xoom and Eventbrite have contributed to his reputation, attracting institutional backing and a focus on supporting young entrepreneurs, including a notable percentage of teenage founders. The firm’s previous funds have demonstrated a consistent pattern of deploying capital into promising startups, with a focus on diverse sectors.
“We’re excited to close our third fund and continue supporting innovative startups that can transform their industries.”
— Kevin Hartz
“This fund underscores our belief in the potential of emerging technologies and young entrepreneurs.”
— Bennet Siegel
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What Remains Unclear
It is not yet clear which startups will be among the initial investments from Fund III, or how the fund’s deployment will compare to previous funds in terms of sector focus or geographic distribution.
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What’s Next
The firm is expected to begin making investments over the coming months, with announcements of initial portfolio companies likely in the next quarter. Monitoring how the fund performs and which startups attract funding will be key indicators of its impact.
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Key Questions
What types of startups will A* Capital invest in with Fund III?
The firm plans to invest in early-stage companies across AI, fintech, healthcare, security, and other sectors, with typical check sizes between $3 million and $5 million.
How does this fund size compare to previous funds?
Fund III’s $450 million size is larger than the $315 million Fund II and the $300 million Fund I, indicating increased investor confidence and growth.
Who are some of the limited partners backing this fund?
Limited partners include nonprofits, foundations, endowments, and Carnegie Mellon University, among others.
When will A* Capital start investing this fund?
The firm is expected to begin deploying capital over the next two to three years, with initial investments likely announced soon.
What is the significance of this fund for the venture capital landscape?
This sizable fund demonstrates strong investor confidence in A* Capital’s approach and could influence funding trends for early-stage startups in multiple sectors.
