March Capital Partners, the Los Angeles-based venture capital firm, has raised $300 million for its latest fund.
It’s another indicator that the Los Angeles technology ecosystem is coming of age, but also a sign that March’s core investment strategies — to invest in companies applying artificial intelligence to business use cases and investing in the next wave transforming computing infrastructure — are paying off.
“We have two major areas and a couple of minor areas,” said Sumant Mandal, a managing director with the firm. “We like data-driven business and two-thirds of our portfolio are AI driven. We also like infrastructure for the internet… the majority of the portfolio will be around those two themes.”
Those two themes are borne out in the support March Capital has provided for The Hive, an artificial intelligence-focused incubator, and The Fabric, an infrastructure and internet of things-focused incubator. Those two San Francisco-based operations have been a pipeline for interesting startups that have become March portfolio companies.
And the firm is also looking at other opportunities. Given its home in Los Angeles, the company is also placing bets around the rise of e-sports and gaming as a new pillar of entertainment and it’s looking abroad at opportunities in India, according to Mandal and managing partner, Jamie Montgomery.
In India, a massive demand for new financial services, coupled with a technology-forward government leadership that’s embracing controversial policies like demonetization, is creating incredible market tailwinds for startup tech businesses, according to Mandal.
Portfolio successes with investments in companies like CrowdStrike, a cybersecurity company which was founded in Irvine, Calif.; EarnIn, the financial services startup obviating the need for payday lenders; VeloCloud, the networking infrastructure and cloud management business sold to VMware for $449 million; and CarTrade, an Indian used car marketplace, all seem to validate the firm’s approach.
“We are three to four years into a 20-year cycle,” says Montgomery. “We’re making sure that we are doing stuff that will survive in an economic downturn.”
Primarily that means focusing mainly on enterprise software businesses,” Montgomery said. Companies like Microsoft, Salesforce and others are arguably better positioned to survive the economic slowdown that Montgomery expects to hit in the next year or two. Montgomery believes there’s no business that won’t require information technology services, and he and his partners are building a portfolio that he thinks is designed to provide them.