Lerer Ventures just closed a $36 million fund, its third and largest since its founding two years ago. The New York-based early stage investment firm has been at the heart of the local technology boom, having invested in more than 130 companies including Warby Parker, Buzzfeed, Birchbox and many others.
The firm began with an $8.5 million fund in 2010 and followed up with a $25 million fund last year. Thanks to New York’s thriving tech scene and a partnership with SV Angel, which helps it get in on many Bay Area deals, Lerer has plenty of work for its four partners: Ken Lerer, Eric Hippeau, Ben Lerer and Jordan Cooper.
I chatted with Hippeau about the third fund and where he sees New York going in the years to come. He said the firm just finished its last investments from the last fund, but there are even more opportunities ahead, especially in New York.
“The number of startups and the tech community in New York is growing and everything is booming for us. We want to continue that,” Hippeau said.
He said while many of New York’s startups have sprung out of the city’s existing industries of media, finance, fashion and retail, the city is now becoming a hot bed of development in social and mobile. And it’s increasingly seeing big exits, like Buddy Media’s $689 million acquisition by Salesforce (s crm). With enough infrastructure now in place, like shared work spaces, investors and incubators, he doesn’t see New York losing its momentum.
That’s not to say the city doesn’t have challenges. Hiring is a problem for all startups in the city and getting good broadband is another fundamental issue. The city of New York has been trying to tackle both problems with new technology schools and broadband projects, including a new competition to give fiber connections to small businesses.
Ultimately, as these initiatives take hold, he believes New York can spawn even more ambitious startups, the kind of companies that might have traditionally begun in Silicon Valley.
“We’ve got great technologists, but we don’t have the deep well of technology that exists in Silicon Valley. So we try to solve real business problems. But we’re not necessarily trying to create the next big wave of technology,” Hippeau said. “We might see that, though, with these centers of technology and we might see more pure technology developed in New York.”
Post and thumbnail photos courtesy of Flickr user hyunlab