AngelList Venture takes on rare capital at a $4 billion valuation

After seven years since its last financing round, AngelList Venture has raised new capital, according to sources familiar with the matter. The company announced in a blog post today that it has raised a $100 million Series B led by Tiger and Accomplice at a $4 billion valuation. TechCrunch has reached out for further comment. (Update: TechCrunch spoke to AngelList after publishing this story, and changed the lede to reflect that the round was a Series B).

AngelList Venture is also opening up a community round, raised on the platform itself, for GPs who have made an investment with them over the past year, the blog post stated.

The fresh capital comes after a massive launch spree from the company, which spent the pandemic beefing up its founder-focused services through rolling funds, roll-up vehicles, AngelList Stack and even a new $25 million fund to back startups solely based on hiring velocity. Plus, it’s adding more capital as it supports more capital. Per data provided by the company, the startup supported 11,300 startup investments last year, up from 3,800 the year prior. It also grew to hold $10 billion in assets, up from $3 billion the year prior.

A question I’ve had for AngelList, for years now, is why not raise venture to meet demand amid growing competition and burgeoning startup formation across the world? It’s the exact question I posed to CEO Avlok Kohli last month when we spoke. He responded with their thesis on hiring.

Kohli said that the company has intentionally kept headcount small so as to limit red tape, and continue to prioritize a high employee to impact ratio.

“We're growing very, very quickly and our expenses are growing linearly, so we actually have very strong leverage on the financing,” Kohli then said. “That's the reason why we've been in a very different position to be able to continue to grow without needing to take on VC funding.”

He added: “We haven’t had to raise another round of funding, but to be clear, there’s nothing wrong with it: some companies just need capital, sometimes they’re in a race to grow very quickly because it’s a winner take all mentality and the characteristics of that market.”

A counterpoint to his answer is that raising venture isn't just used for race purposes, it is also used to pursue new opportunities and acquire competitive intelligence. Kohli said he wasn't compromising, he was just focused on keeping AngelList Venture at a high shipping velocity.

"I think ultimately, companies that raise typically also increase headcount pretty significantly," he said. "You get slower as you grow, and that's actually really tough for a technology company, because if your entire focus is on shipping velocity and shipping great product, growing headcount is actually counter to that."

So, if the capital isn't for headcount, what is it for? AngelList has told me that they've considered taking on some acquisitions in the past, but talks have never gotten to a serious point. It could be for research and development, new funds or, heck, if they want me to stop guessing and just tell me, they should feel free.

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