Microsoft’s fingerprints are all over the Seattle and global tech ecosystems, and here’s the latest example: a venture capital fund run by an ex-Microsoft executive is now backed by the tech giant’s co-founders, Bill Gates and the late Paul Allen.
Allen’s investment arm Vulcan Capital committed $20 million to a fund being raised by Capria that will be used to back fund managers in “emerging markets.” Capria is raising $100 million for this fund and has selected the first couple firms it will invest in.
Vulcan Capital is joined by the Ford Foundation, Omidyar Network and Resonance Impact Fund as the latest investors in the fund. Capria is rolling cash it raised previously into the fund, and past investors include Gates and International Finance Corp. — a sister organization of the World Bank — Ceniarth, Sall Family Foundation and Sorenson Impact Foundation.
Based in Seattle, Capria is led by Will Poole — a 12-year veteran of Microsoft who ran the Windows client business and was a corporate vice president for a program focused on bringing products to emerging markets — and by Dave Richards, a former vice president at Real Networks. The other co-founders are Jack Knellinger, another ex-Microsoft employee, and Daniel Kranzler, a veteran startup entrepreneur and investor.
Capria is an “impact investor,” which means its investments are focused on making the world a better place. However, Poole says, Capria still seeks to make money off its investments. Emerging markets, the company argues, are more resilient than U.S.-based companies that tend to swing dramatically as key indicators like the stock market shift.
“We are investing to see positive social and environment benefits, but we are doing it very much with a profit-first motivation,” Poole said. “That’s the particular strategy we’ve selected, and it’s one that we think is in fact going to become the dominant way people invest in the future, to be seeking profits but at the same time to be mindful of improving the world around us while we do so.”
Having Gates and Allen separately invest in Capria was “thrilling, gratifying,” Poole said. Gates invested more than two years ago in a pilot fund that helped Capria get off the ground.
Allen’s Vulcan came on board after Chief Investment Officer Chris Orndorff paid a visit to Capria’s offices in Seattle’s Pioneer Square neighborhood. He saw a map showing the parts of the world Capria’s investments have touched and said “I want to be a part of that,” according to Poole.
Out of the $100 million it is seeking to raise, Capria has a combination of hard and soft commitments for $46 million, Poole said. Capria’s first two investments out of this fund are Adobe Capital of Mexico and Fen Ventures of Chile.
Capria previously invested in both Adobe and Fen as part of the pilot fund that made 14 other seed-sized investments. With this fund, Capria plans to make more substantial commitments.
Capria has 25 employees spread across offices in Seattle; Bangalore, India; Nairobi, Kenya and Singapore.
The decision to invest in local fund managers with immense knowledge of their markets comes from experience with past investments as well as Poole’s time at Microsoft. Poole says he’s learned that it’s tough to make the right decisions on investments when you’re not close to the founders, the dynamics of the market and the companies that may some day buy the startups.
Poole took away from his time at Microsoft the belief that a company can both make money and change people’s lives for the better. On the flip side, Microsoft would sometimes have to adjust strategies that flopped due to the dynamics of the market.
“Through those successes and failures I learned the importance of having very strong leadership on the ground, particularly for pioneering early growth work that can’t be done by someone sitting thousands of miles away and flying in once a month or once a quarter,” Poole said.