When Xfund was founded almost a decade ago, the early-stage venture firm sought to nourish a burgeoning entrepreneurial culture on campus – and beyond – and make a profit as well. Originally called the Experiment Fund, it adopted an unorthodox approach to scouting promising founders.
The Harvard John A. Paulson School of Engineering and Applied Sciences (SEAS) provided early non-financial support. Then-SEAS Dean Cherry Murray was a key on-campus advocate, as was then-Faculty of Arts and Sciences Dean Michael Smith. Both continue to serve on the fund’s advisory board, along with subsequent SEAS Deans Harry Lewis and Frank Doyle.
From the outset, the Xfund’s mission has been to find and support “lateral thinkers.”
“We live in an increasingly technocratic world,” says Xfund Partner Patrick Chung, A.B. ‘96, MBA/J.D. ’04, who runs the fund with Partner Brandon Farwell, MBA ’14. “Most venture firms today will only talk to people who majored in computer science or engineering. Xfund will, of course, invest in computer scientists and engineers—but we also seek out history majors, English majors, economics majors, and classics majors. We are identifying and nurturing founders that other VCs are systemically ignoring.”
This week, the Cambridge- and Palo Alto, Calif.-based firm announced that it has raised its third fund. Led by founding VC firms New Enterprise Associates and Breyer Capital, Xfund 3 surpassed its $100 million target with $120 million in funding from a range of university, institutional, and individual investors.
During its almost 10-year run, Xfund has stimulated entrepreneurship through outreach events and programs and kickstarted an impressive list of ventures spawned in Harvard labs and dorm rooms.
In an industry in which access to capital is frequently elusive for women and people of color, Xfund has been an outlier. In 2019, under 3 percent of all venture capital dollars in the U.S. were invested in women, according to data from PitchBook. By contrast, one-third of Xfund’s capital is invested in companies with women founder/CEOs, and 72 percent of the firm’s capital backs companies led by women, minorities, or immigrants.
Xfund-backed companies with a Harvard provenance include fintech Kensho, healthtech Curebase, Internet TV provider Philo, online apartment rental platform Zumper, fertility company Natalist, B2B research platform NewtonX, career path platform Landit, and autonomous vehicle startup AeroVect, among others. Xfund was the first investor in most of its portfolio companies, and frequently reinvests with follow-on capital as companies grow.
“Meeting Patrick Chung that one day at Harvard inspired me to become an entrepreneur and turn down a career in medicine,” says Tuan Ho, A.B. ’09, Co-Founder of Philo. “Without Xfund, Philo wouldn't exist. Xfund was our first investor, part of the founding team and nearly a decade later, Patrick is still our most trusted partner.”
Harvard faculty and administrators serve on Xfund’s advisory board and student groups like the Harvard Computer Society and Harvard Student Agencies are active partners.
“The success of Xfund’s latest fund is a strong testament to the singular way in which the firm helps talented founders grow companies that matter,” says SEAS Dean Frank Doyle. “We have enjoyed a long and dynamic partnership with the fund and look forward to building on that collaboration in the future.”
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