Zal Bilimoria Just Raised a Fourth Fund of $50M Refactor Capital, and Still Enjoys His Single Doctor Status | TechCrunch

Zal Bilimoria has been a sole general partner since 2018 and has no plans to stop. And he credits the decision to former colleague David Lee, who started Refactor Capital with him in 2016.

He said he wouldn’t have been able to start the Burlingame-based firm without Lee, a former Google executive who ran Ron Conway’s SV Angel venture fund for several years. Together, they raised a seed fund of $50 million. When Lee decided to retire in 2018, he wanted Bilimoria to stay with Refactor as a sole practitioner.

Being a sole practitioner means having full authority to make investment decisions alone, while also having full responsibility for things like fundraising. And while that level of freedom may sound great, it also means there are no designated partners to talk to, pushing and making a VC consider investment decisions in ways they might not have thought of. . As angel investors do this, they are spending their own money. A single investor is investing on behalf of limited partners who are trusting that this person will grow their money.

“He convinced me to stand alone, and this was at a time when solo GPs weren’t fashionable,” Bilimoria told TechCrunch. “He told me that since I love my independence and authority and I like spending time with the founders, I should be alone. I was super nervous, but the more I thought about it and talked to other people, I knew it was what I wanted to do, and I haven’t looked back. I’m going to be a single doctor for the rest of my career if I can help it.”

Bilimoria is not without its unique origins. Before joining Refactor, Bilimoria spent nearly three years as a partner at Andreessen Horowitz, where he helped raise the firm’s $200 million Bio Fund. Prior to a16z, Bilimoria spent a decade building technology products at tech giants including Google, Netflix, LinkedIn and Microsoft. He was also the founder of consumer mobile startup Sniply.

With Refactor, he’s investing in companies that “solve the biggest challenges facing society,” he said. In fact, the term “refactor” comes from computer science and refers to making code more efficient.

And being a single GP hasn’t slowed Bilimoria down one bit. It went on to raise three additional funds and has now closed a fourth fund of $50 million in capital commitments to invest in biotech, climate and hard-tech startups.

Since its launch in 2016, Refactor has invested in more than 100 companies, four of which have gone on to become unicorns, including Solugen, which is using synthetic biology to remove hydrocarbons from the chemical industry, and Astranis, which makes microsatellites.

Last week, Solugen received a $214 million loan from the Department of Energy’s Office of Loan Programs to build the next Solugen Bioforge in Minnesota that will make chemicals from corn sugar rather than petroleum. Awarded to a small number of startups, the DOE made a similar loan to Tesla in 2010.

Bilimoria was able to raise the new fund in less than 90 days, he said. Ninety percent of the fund was raised from existing limited partners, including firms such as Knollwood Investment Advisory. Most LPs are institutional investors and the entire LP group is a US investor.

“I feel very lucky to have this LP set,” he said. “I was chasing an institutional investor for the last four funds and finally got them into this fund, so they’re part of my new 10%.”

Bilimoria is finishing the investments from the third fund, but has already allocated part of the capital from the fourth fund.

This new fund will continue to lead seed and seed investments in startups working in areas including new battery technologies, cancer therapies, IVF advances and chemicals. Check sizes are typically $1 million to $2 million and will be distributed among 20 to 25 companies over the next three years, Bilimoria said.