Announcing Fund V

Today we closed Fund V at $650 million, our fifth fund since Theo Marchetti and I started Northwood in London in 2012. The first close came in February. Almost all of the capital comes from foundations, endowments and families who have invested with us before, and we are grateful to them for coming back, and to the eleven new partners who have joined them.

We could have raised more. We chose not to, because a much larger fund would have pushed us towards larger rounds and later stages, and that is a different job from the one we are good at.

What stays the same

We will keep leading seed and Series A rounds in Europe and North America, in the six sectors we know: fintech, climate, health, infrastructure, software and industrials. We will keep writing a few large first cheques rather than many small ones, and we will set aside more than half the fund to back our companies again in later rounds.

The people stay the same too. The partners who will lead Fund V investments have all worked here for years, and the partners who raised the fund are the ones who will sit on its boards. A company that takes our money gets the person who made the case for it, for as long as they need them.

And we will keep publishing our fund figures and our letters to investors, so founders can see how we have done before they decide whether to work with us.

What changes

Three things.

First, our Series A cheques get larger. We can now lead an A round of up to $25 million on our own, which means fewer founders will have to assemble a syndicate to raise one.

Second, we are giving climate and industrials more of the fund. These companies often need more capital, over longer periods, before they earn revenue, and we want to be able to stay with them through that stretch. Clara Novak and Grant Holloway will lead most of that work.

Third, the platform team grows. Lena Fischer’s team, which helps companies with everything from finance to their first enterprise contracts, and Imani Clarke’s talent team will each add people this year, so that every company in Fund V has someone to call who is not on its board.

If you are building something in one of our sectors and want to talk, our pitch page explains how. We read everything that comes in.