Santa Cruz Tech Beat

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Axios: TinySeed raises $25 million to back more bootstrapped startups

By Kia Kokalitcheva
Axios

March 16, 2021 — Santa Cruz, CA

(Image above: Credit: Aïda Amer/Axios)

[Editor’s note: Santa Cruz Tech Beat published Q&A: Einar Vollset talks about TinySeed, early stage SaaS fund (2/24/21)]

TinySeed, which runs an accelerator program for very early-stage business software startups that are largely bootstrapped, has raised $25 million for its second fund, the company tells Axios exclusively.

Why it matters: The news comes at the heels of the recent shuttering of Indie.vc, an experiment from O’Reilly AlphaTech Ventures in backing revenue-generating startups not seeing heaps of venture funding. 

The big picture: While buzzy multibillion dollar acquisitions and IPOs tend to hog all the headlines, tons of software companies quietly sell for around $100 million—and generate healthy returns for shareholders, explains TinySeed co-founder Einar Vollset

  • TinySeed’s focus on business-to-business software companies means that the startups it backs are capital efficient, and can quickly get on a path of growing revenue thanks to the accelerator program. 
  • Its investors include Bloomberg Beta, Eric Ries, Patrick McKenzie, Steli Efti, and Rand Fishkin.

Behind the scenes: While Indie VC failed to attract the necessary interest of limited partners who back traditional venture funds, TinySeed mostly struggled with another problem: a regulatory limit of 99 investors for a fund larger than $10 million, Vollset says.

Continue reading here: https://www.axios.com/tinyseed-software-startup-venture-capital-ab4017d7-07de-406b-8ad8-fb82fa51a697.html

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