Los Angeles is no longer the best kep tech secret in California, but its early-stage startup scene still has a lot of room to grow.
Fika Ventures hopes to contribute to that growth and build a thriving startup scene in LA. To that end, the VC firm announced on Thursday that it has raised $76 million in funding to fund early-stage companies.
Over the next couple of years, we’ll start to see repeat entrepreneurs come out of these successful LA companies.”
The funding will help the firm lead more investing rounds and capitalize on the increase of founders moving from Silicon Valley to LA to start their own companies, said TX Zhuo, who’s a partner at Fika Ventures.
“LA is benefiting from the exodus of founders and investors from Silicon Valley,” Zhuo said. “From a capital standpoint, the market is still underserved, especially at the seed stage, and this new fund will allow us to capitalize on the opportunity.”
Founded in 2017, Fika Ventures has primarily provided seed funding for LA companies in fintech, real estate, education, healthcare and others. The firm is focused on investing in companies seeking to have a positive impact on the lives of people and society.
About half of Fika’s investments was in LA-based companies, while the other half went to markets across the U.S., according to the firm.
With this second round, Fika Ventures plans to up its ante, doubling its initial average check size to $1 million and leading more funding deals. The boost coincides with the growing success of homegrown tech companies in LA like ServiceTitan, Honey, Next Trucking and Clutter, said Zhuo.
Meanwhile, LA recently ranked sixth among the world’s best tech cities.
“This shows how tech is evolving here, and we feel that over the next couple of years, we’ll start to see repeat entrepreneurs come out of these successful LA companies,” Zhuo said.
Fika Ventures’ portfolio includes companies like the home daycare company WeeCare, food delivery platform Chowbus and foodborne illness detection platform PathSpot.