Tim Chen, solo VC at his agency Essence VC, stated he simply closed his fourth fund, a recent $41 million, with out even making an attempt. Restricted accomplice buyers had been so keen to take a position, they preempted it, he advised TechCrunch. He didn’t even have time to generate a pitch deck. 

A $41 million elevate won’t sound like a lot on this age of multibillion-dollar enterprise corporations and solo VCs like Jack Altman (who simply raised his second big fund, at $275 million). However that’s primarily as a result of Chen didn’t need to tackle extra. It’s an upsize from Chen’s 2022 third fund of $27 million (which was up from his $5 million second and $1 million first fund). 

Chen hadn’t begun new fundraising exercise as a result of, till final month, he was nonetheless investing out of his third fund, which has now wrapped. However restricted accomplice buyers had begun whispering about him amongst themselves after considered one of his portfolio firms from his second spherical, Tabular, was acquired by Databricks for about $2.2 billion in 2024. 

“That mainly, just about returned our entire fund,” Chen advised TechCrunch, and put him “on the map,” as he described. All of a sudden, LPs had been listening to his title in every single place: on cap tables, talked about by different VCs, founders quoting his recommendation. They needed in. 

Partially, that’s as a result of Chen makes a speciality of developer-tool and infrastructure startups on the earliest levels, a section rising in reputation on this age of AI. 

Chen lower his tooth as a software program engineer, incomes avenue cred from his time as one of many earliest staff at Mesosphere, a one-time scorching open supply cloud infrastructure startup backed by Hewlett Packard Enterprise and Microsoft; then he co-founded an “AIOps” startup known as Hyperpilot and bought it in an acqui-hire to Cloudera in 2018.  

In 2019, Chen started angel investing and found he had a knack for it, backing different deeply technical startups like Jasper, Flatfile, and MotherDuck. “I actually loved it. Founders saved loving me, saved telling all their mates.”  

On the lookout for a brand new profession, he thought enterprise was it, so he interviewed at a number of of the large Sand Hill Highway corporations, solely to be rejected by all of them.

“Nobody needed to rent me,” he stated. “I’m an engineer and small-exit founder. I don’t assume that’s a typical profile.” 

Jake Zeller, a buddy of his who labored at AngelList (and is now out at his personal fund), advised Chen not to surrender and talked him into launching his personal fund on that platform. 

“He advised me, ‘Tim, I believe you possibly can go elevate a $1 million Fund 1 and check out it out.’ I stated, ‘Wow. I didn’t know that was potential.’ So he gave me a pitch deck template,” Chen recalled, and thru introductions, Chen landed LPs like Bain Capital. 

Famed infrastructure and AI investor Martin Casado of Andreessen Horowitz got here in as an LP in later funds. After which long-time fund-to-fund investor Michael Kim of Cendana Capital invested. After Tabular bought, Kim advised him that Cendana had already reserved $15 million for his fourth fund. Chen was shocked.  

He was additionally getting calls from others, some who had been earlier buyers like Sapphire, Normal Catalyst, and new people. “I wasn’t fundraising. I didn’t understand how a lot to boost in any respect. I used to be similar to deploying and vibing,” he stated. 

When StepStone pushed him to ship LP paperwork so they might wire the cash — and needed to convey others in — he opted to get his act collectively and do the fund instantly. AngelList mainly did his fundraising paperwork for him. He settled on an inexpensive bump from his final fund, transferring cautiously as a result of he nonetheless considers himself a newbie at enterprise.

Fund IV backers wound up together with names like Tomasz Tunguz (former Redpoint accomplice, now of Concept Ventures ) and Ethan Kurzweil (previously Bessemer accomplice, now of Chemistry VC).  

He credit his rising repute to his background as an infrastructure engineer. “There’s so few VCs that seem like me,” referring to his deeply technical background with software program infrastructure.

Whereas that wasn’t interesting for the large corporations, it’s been a boon for his solo investing. Relatively than a typical VC give attention to traction and gross sales funnel, Chen helps early founders determine methods to construct their merchandise. 

As an illustration, he invested in an organization known as ComfyUI which was, on the time, engaged on a shopper visible AI product based mostly on the open supply Secure Diffusion mannequin. After investing, Chen suggested the founders to change into a developer platform of the fashions they had been fine-tuning.  

Cozy-org simply raised a $17 million Collection A to compete with the large closed supply mannequin makers. And their weblog submit publicly thanks Chen for serving to them craft their technique.