Boston-Based HubSpot Ventures Raises $30M Fund To Invest In Early-Stage Startups

HubSpot, a Boston sales and marketing software company with over 52,000 customers worldwide, remembers what it feels like to be small, scraggly, and needy.

And so, on Tuesday, the company started by a few MIT graduate students in 2004 announced HubSpot Ventures, a $30 million venture fund that will be dedicated to investing in software as a service startups.

“We will not seek quick wins, early exits, or rapid returns on investment with this fund. That is not our approach,” said Dharmesh Shah, founder and CTO of HubSpot, in a LinkedIn post announcing the new fund.

Andrew Lindsay, who heads HubSpot Ventures, said that they will mainly participate in Series A and Series B rounds due to the size of the fund. Prior to announcing the fund, HubSpot, according to Crunchbase, has already invested in ten early-stage startups.

“These are not donations,” he said. HubSpot will not be leading rounds, but hopes that it will add value through access to software and minds.

In addition to the new fund, HubSpot also announced on Tuesday that it will begin a three-year collaboration with Amazon Web Services to help small to medium-sized startups grow and scale.

Lindsay explained that the fund will invest heavily in Boston-rooted startups because of the deep connections the company already has in the city’s startup ecosystem. They’ll specifically focus on investing in companies that meet some core standards, including a commitment to details found in HubSpot’s customer code. This includes things like “own your screw-ups” and “do the right thing even when it’s hard.”

HubSpot said that one of the reasons their fund is different from other, much larger startup funds is that they’ll prioritize culture when picking startups. To find investments that are a culture fit, Lindsay said HubSpot won’t mind “going beyond the well trod path” of just relying on word of mouth. He also said HubSpot will be looking for eager startups from around the country.

“Anything that is looking beyond the traditional sources of investment,” he said, which includes going to events focused on diversity.

Those opportunities might even be found in their own backyard. According to Lindsay, a HubSpot employee could potentially get funding for an idea. They’d have to meet all of the criteria in order to get funding, of course, but an employee would have one key component of HubSpot’s investment criteria locked down: the mission and values that drive HubSpot.