First Star VC Plans $40 Million Third Fund for Deep Tech Investments

Deep Tech VC First Star Plots a $40M Third Fund

First Star, a venture capital firm known for backing deep tech startups, is planning to raise a $40 million third venture fund. This marks a significant increase from its previous funds, signaling a growing ambition in the deep tech investment space.

About First Star

Based in Cambridge, Massachusetts, First Star focuses on early-stage investments in companies specializing in robotics, blockchain, AI, and machine learning. The firm's founding partners, Millie Liu and Drew Volpe, have strong ties to both MIT, where they conducted research, and MassChallenge, a prominent startup incubator.

Fund History

Debut Fund (2014): Launched as Procyon Ventures with $10 million.
Second Fund (2019): Raised $25 million.
Third Fund (Planned): Aiming for $40 million.

Investment Focus and Recent Deals

First Star's recent investments highlight its commitment to cutting-edge technologies:

ChiselStrike: Participated in a $7 million seed round for this company, which develops tools for back-end software developers.
Zanskar: Invested in a $12 million Series A round for Zanskar, a startup using AI to identify geothermal resources for decarbonizing the U.S. power grid.
Fyto: This MIT-founded startup, backed by First Star, utilizes robotics to grow sustainable feed for cows, aiming to reduce water waste and greenhouse gas emissions. Fyto is considered a climate tech venture.

Market Context

First Star's move to raise a larger fund comes at a time when other venture capital firms are also increasing their investment sizes. For instance, Cantos, another deep tech VC, recently launched its own $50 million third fund with a focus on addressing the climate crisis.

Key Takeaways

Increased Fund Size: First Star's planned $40 million fund is a substantial increase from its previous funds, indicating confidence in the deep tech sector.
Focus Areas: The firm continues to prioritize robotics, blockchain, AI, and machine learning.
Climate Tech Emphasis: Recent investments in Zanskar and Fyto suggest a growing interest in climate tech solutions.
Strong Ties to Academia and Incubation: The partners' backgrounds at MIT and MassChallenge provide a solid foundation for identifying and nurturing promising startups.

Topics Covered

Biotech & Health
Boston
Climate
Deep Tech
First Star Ventures
Hard Tech
MIT
Startups
Technology
Venture
Venture Fund

The Chainsmokers' Mantis Ventures closes $100M third fund
Amazon's Kuiper satellites to get boost from rival SpaceX
US Army soldier pleads guilty to hacking telcos and extortion
A former OpenAI engineer describes what it’s really like to work there
Meta fixes bug that could leak users’ AI prompts and generated content
AV startup Pronto.ai acquires off-road autonomous vehicle rival SafeAI
Mira Murati’s Thinking Machines Lab is worth $12B in seed round

Social Sharing

Boston Skyline

Image Credits: Billie Weiss/Boston Red Sox/ / Getty Images