When Xuezhao Lan first formed Basis Set Ventures, the goal was to leverage technology to give venture capital investing super powers.That product development is one reason the firm has managed to stay relatively lean and why it was two times oversubscribed when it went out to raise its second fund, a $165 million vehicle, which closed recently.
The fund isn’t that much larger than the $136 million Basis Set had previously raised, but Lan thinks it’s the right size for her goals, which are to return massive amounts of capital to her limited partners.
Internal technology programs like the company’s Pascal system have allowed Basis Set to review roughly 9,000 different software deals developing tech in the company’s core thesis, which is artificial intelligence-enabled software as a service and business-to-business deals.
Over the next year, those technology services are going to start paying dividends, according to Lan, in the form of a couple of initial public offerings that will soon make their way to market.
And Basis Set doesn’t limit itself geographically, thanks to the coverage support that its software provides. “Pascal is a major asset for finding companies outside of the Bay Area,” said Lan.
Once those companies are identified and in the portfolio, the startups have access to a tool called HyperGrowth, which links tech companies with mentors from the Bay Area to help those companies scale. It’s another example of Basis Set’s product-driven approach, said Lan.
“When I started BSV, we were a pretty technical team and technical people. Every single person came back to us to ask how to grow, how to do sales, how to do tech, how to make the first hires, introductions to customers, introductions to advisors. The number one need for companies is go to market,” said Lan. “Over time we started scaling that effort. Introductions manually, and then holding events, and then bringing in a growth partner, Sheila. We built this tool where hundreds of advisors would opt in to be connected to a portfolio company.”
Currently Basis Set has at least three different programs, all aimed to recruit and nurture talent that typical Bay Area firms haven’t traditionally focused on. The first is its Persistence platform, which is designed to help women developers and founders network and nurture connections and foster ideas. The firm also has a service that it calls Founder Superpowers, to help entrepreneurs identify and develop areas of strength while looking for additional tools to augment their capabilities.