Arizona-Centric Venture Capital Firm Closes Record Setting Fund to Support Local Companies Beyond the Desert
PHOENIX, Oct. 14, 2022 /PRNewswire/ — AZ-VC, the Arizona-centric venture capital firm, today announced the close of its first fund, with an oversubscribed total raise of $110 million. AZ-VC (formerly invisionAZ Fund) is led by Jack Selby, an original employee and former executive at PayPal. The fund is backed by an almost Arizona-exclusive list of LPs, many of whom will be actively engaged as advisors in helping source, mentor and grow portfolio companies.
As a 20+ year resident of Arizona, Selby believes the state is a massive untapped resource of entrepreneurial activity. Phoenix is the 5th largest city, and the country’s fastest growing metropolitan region. Pandemic newcomers from neighboring California and elsewhere continue to fuel the Arizona economy, especially refugees from Silicon Valley looking for higher quality of life and more affordable housing, while maintaining manageable proximity to their former state.
Despite these tailwinds, Selby laments what he has described as the Sonoran “Funding Desert” paradox, which begins with a lack of local capital sources positioned to write a Series A check of $2-5 million. This financial void forces Arizona’s best companies to fundraise outside of the state, which is problematic for two reasons. First, raising capital for start-ups is always hard, and even harder as an out-of-town prospective portfolio company. As such, many Arizona companies have simply failed to launch beyond seed-level funding. Second, out-of-state VCs recycle any financial windfalls in their respective home ecosystems, preventing any flywheel effects from benefiting Arizona.
AZ-VC will focus on Series A and beyond opportunities. The strategy will be sector agnostic and entrepreneur centric. The fund will leverage Selby’s “PayPal Mafia” background and open doors for portfolio companies in Silicon Valley and around the world.
To date, AZ-VC invested $3 million in Mosaic, the first elastic national general contracting service for digitally empowering the homebuilding industry; led an investment round in Uplinq, a provider of advanced bookkeeping solutions that rely on data automation and machine learning to small and medium-sized businesses; and is ready to add more impressive logos to the family.
“This fund is a litmus test for Arizona in two respects,” Selby said. “First, we could have gone to long-standing allocator relationships in places like London, Tokyo, Abu Dhabi, et al, and raised the fund in a straightforward manner. Instead, we chose to challenge local investors to choose if they wanted to see a fund like ours rise up in our home community and back Arizona-based companies. I knew raising the fund would be a challenge, but I am heartened with the outcome. I salute our investors, led by Pinnacle West Corporation (PNW), our $25 million anchor.
Selby continued, “The second test will be finding the companies to deploy $110 million in the local ecosystem. I am certain the Arizona start-up community will gladly accept the challenge.”
“Our focus is to back exceptional local startups and provide them with the resources to win on a national stage” said Benjamin Brockwell, Principal at AZ-VC. “In addition to creating a top-notch investment portfolio, we are heavily committed to providing opportunities for the state’s best talent.”
AZ-VC is a $110 million Series A and beyond venture capital fund based in Phoenix and focused on Arizona technology companies. The strategy is sector agnostic, and the fund aims to deploy investments between $2–5m. The fund is managed by Jack Selby, a 20-year Arizona resident and former PayPal executive.
For more information, visit AZ-VC’s website and their LinkedIn profile.
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