In 2015, we started NFX as an accelerator in Palo Alto. Our goal was to work hands-on with founders to help them create and build important tech companies from the earliest stages. It was incredibly fun. From seventy companies that went through our program, six hit unicorn valuations, and six others hit $100M+.

In 2017, when we decided to move on from that model, we had a decision — do we invest our own money, or do we bring on LPs? Before NFX, we had built ten companies that sold for over $10B combined, so we were fortunate to have the option. At the time, some of us advocated to self-fund our investments. Others advocated scaling our impact, building connective tissue upstream to LPs, and building an institution. We decided on the second path. Since then, we’ve raised $1.5B in 5 funds and some SPVs. In all phases, we’ve invested in about 42 unicorns so far, with more to come this year. With continued luck (yes, there’s a lot of luck in all this), we will return many multiples of $1.5B to our LPs.

But now it’s been nine years since 2017. Given that AI is changing how startups are built, and thus how the whole VC ecosystem is going to work, the question of whether to self-fund came up again. Do we really need a large fund to have the same impact and keep doing what we love? The world has changed. We’ve changed. This time we’re choosing the path we didn’t choose in 2017. We’re changing our funding strategy.

We’ve decided to revisit that 2017 decision and self-fund our investments. We’ll still invest in great founders and support them, but now we can be fully flexible. Our check sizes will be between $ 100K and $3 M of our own money. We will invest in any stage, any sector/industry, and any time horizon. We don’t need to lead rounds, take board seats, or meet ownership targets.

We suspect this new strategy will produce great returns. In periods of major change, flexibility is the best approach. The world opens up for the types of investments we can participate in. A big nod to our friends at Homebrew, who made a similar shift in strategy in 2022.

We will continue to support our current founders and LPs for at least the next ten years. That is our first order of business.

To our LPs over the last nine years, we owe a big debt of thanks for your support. You were the institutional grounding we needed, and the network that connected us to the ecosystem. We truly appreciate the work you do and the advice you’ve given us over the years. It’s been an honor and a privilege.

To the other VCs — many whom we have co-invested with, some of whom helped us meet our LPs — thank you again! You have been generous and collaborative. We’re still here. Just more flexible in how we can participate in your companies.

To the many NFX teammates we’ve had over the last eleven years, we can’t thank you enough. Working and building with you — treating this VC firm as a startup itself — has been more creative and rewarding than we could have hoped for.

To founders, we are still actively investing out of Fund IV and will be into 2027. After that, we will remain as we are, but invest smaller checks. We’ll keep supporting our companies as board members and advisors exactly as we always have. We will continue to have your backs, help improve your odds, leverage our networks, be there when you need us, and stay out of your way when you’re cooking.

In the meantime, let’s all enjoy the delicious chaos in the market right now. So much opportunity and so many great stories are waiting to be written. We need inspiring people and stories more than ever, and if you’re reading this, you’re one of the people who can write those stories.