Brooklyn Bridge Ventures, a three-year-old, seed-stage venture firm led by its founder and sole general partner, Charlie O’Donnell, is about to close its second fund with $15 million, up from an $8.3 million debut fund closed last year.
It’s a meaningful milestone for O’Donnell, who got his start in venture capital as an analyst at Union Square Ventures and later worked as a principal with First Round Capital before striking out on his own in late 2011.
Last week, we sat down with him in San Francisco to talk about what the fundraising process has been like. We also chatted about his current portfolio, whether Silicon Valley VCs are paying as much attention to New York as they have in recent years, and why he’ll (probably) never be more than a one-man show.
You’re just finishing up your first fund. How many companies did you wind up backing and what was your average check size?
We funded 33 deals and the average check size was between $200,000 and $250,000.
Given its size, were you able to make any follow-on investments?
I don’t care about that stuff. I’m getting in so early [that] my average pre-money valuation is $4 million. If you sell a company for $250 million and you got in at $4 million and your fund is only $8 million, the multiple is so high and the base is so low that you return your fund on just two or three of those deals.
At $8 million, you basically need to create a billion dollars in total enterprise value across 33 companies. It’s hard work, but you don’t have to suspend reality to imagine that a few portfolio companies might exit [in acquisitions totaling around] $250 million. You get four or five [additional] $50 million [exits], and a couple of singles and doubles where you get your money back, and it’s a 3x fund, even if the other 17 investments go to zero.