Eric Schmidt is a busy bloke. He may have stepped down as Alphabet’s executive chairperson at the end of 2017, but, among other things, he continues to chair the U.S. Department of Defense’s Defense Innovation Advisory Board, runs a STEM fellowship in partnership with the Rhodes Trust, and invests in startups both as an individual and through his venture capital fund, Innovation Endeavors, for which he’s the cofounder and anchor LP.
The firm, founded in 2010, has invested in the likes of Uber, SoFi, Planet, Periscope Data, and Tango Card (which Crunchbase News recently covered). And Innovation Endeavors will have some fresh capital to commit to startups as the firm comes out of a period of transition.
Yesterday, Innovation Endeavors filed paperwork with the SEC for its third fund, which is imaginatively named “Innovation Endeavors III LP,” a $333.5 million investment vehicle with 69 limited partners that first started raising in late October 2017. The fund appears to be oversubscribed, considering that its initial filing (dated November 14, 2017) stated a target fund size of $300 million.
Fund III also appears to be the firm’s largest to date. According to the firm’s most recent advisory filing with the SEC, last updated in late March 2018, its second fund (“INNOVATION ENDEAVORS PARTNERS II, LLC”) had $236 million in gross asset value, and its first fund (“INNOVATION ENDEAVORS, LLC”) had roughly $107.5 million in gross asset value at the time of filing.
All this comes during a time of transition for Innovation Endeavors, which merged with Herzliya, Israel-based Marker LLC in August 2017. As part of the merger, Marker (and its funds) would be renamed Innovation Endeavors. According to Crunchbase data, Marker’s second fund, closed in May 2015, was $207.7 million. The size of its first fund wasn’t available through Crunchbase or public disclosures.
According to a now-deleted blog post announcing the merger, a cached version of which Crunchbase News retrieved from the Internet Archive, Marker’s co-founding partners Rick Scanlon and Yuval Shachar, as well as Marker partners Ziv Kop and Liat Aaronson, would join extant Innovation Endeavors GPs Dror Berman and Scott Brady to collectively manage the firm. As part of the merger, the blog post said, “Eric Schmidt will be a co-founder, a non-managing member and the anchor LP.”
According to Israeli business journalist Yasmin Yablonko, publishing in Globes Online, Schmidt was scheduled to be in Israel last week for a closed-door meeting on May 19th, two days prior to the signing date for Fund III’s paperwork, associated with his fundraising activities. As an aside, the “14 leading personalities” attending the meeting would include Israel Innovation Authority CEO Aharon Aharon, Professor Dan Ariely, and Microsoft Israel CEO Assaf Rappaport, among others.
On May 18th, though, Israeli tech publication CTech revealed that Ziv Kop is leaving Innovation Endeavors. Kop is the third person from Marker’s investment team to leave Innovation Endeavors since the merger. Both Yuval Schachar and Liat Aaronson left the firm in October 2017, two months after the merger and just before the first LP check was signed for Fund III. These sorts of departures aren’t uncommon during fund mergers and restructuring.
Rick Scanlon is the only remaining member of Marker’s investment team listed on the paperwork for the third fund.
It’s no secret that Israel is home to strikingly talented engineering and business executive talent, so Innovation Endeavors’ merger with Marker could be seen as a great strategic move. With a third of a billion dollars to deploy in the US, Israel, and elsewhere, it will be interesting to see how the merged fund positions itself in the market and just how much influence Schmidt, an ostensibly non-managing member, exerts on the fund going forward.
Crunchbase News did not receive comment prior to publication.
Illustration: Li-Anne Dias