DealmakingFintech

With an eye on fintechs, a16z raises $4.5 billion across two funds

The pair of funds brings the firm's total assets under management to $16.5 billion

A16z – also known as Andreessen Horowtiz – announced today the close of two massive new funds, part of which will go toward backing financial services companies.

The firm has raised $1.3 billion in an early-stage fund, called “Fund VII,” to invest in financial services technology, consumer and enterprise startups. It also has raised $3.2 billion in a separate fund, called “Growth II,” that will invest in its vertical domains including, financial technology, bio, crypto and others.

The closing of these two funds brings the firm’s total assets under management to almost $16.5 billion. The firm did not respond immediately to a request for comment.

Fund VII has 11 “primary” investing partners and continues to invest in both seed and early-stage venture rounds. Meanwhile, Growth II has three primary investing partners and looks for companies “that have demonstrated product-market fit and are looking to expand their go-to-market footprint,” according to the firm’s blog post

The famed venture firm has long been a backer of fintech startups. Founded in 2009, a16z invests across all stages and has backed hundreds of companies over the years. When it comes to fintechs, it’s backed the likes of Plaid, Earnest, and Seed. (Plaid’s pending purchase by Visa is currently being investigated by the DOJ).

a16z also backed alternative payments startup Affirm, which this week filed its S-1.

The firm also in 2018 launched a dedicated crypto fund from a subset of its limited partners who provided the firm with $300 million in capital commitments, as reported by TechCrunch. This past April, the firm announced the close of a second crypto-focused fund that had $515 million in capital commitments.

Also, in February, the firm raised $750 million for its third fund, which was earmarked for biotechnology and health care investing.

The pool of capital for fintech startups is only growing as more LPs and investors recognize accelerated and increased digital adoption in the financial services space. On Thursday, we covered Financial Venture Studio’s $13 million close. And last week, we reported on Better Tomorrow Ventures’ new $75 million fund.

This story was updated post-publication to add additional background details.

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