LA-Based Fika Ventures Sets Up A Sophomore Fund To Help Grow Local Startups

By Amit Chowdhry ● May 28, 2019
  • Los Angeles, California-based Fika Ventures has established a $76 million sophomore investment fund
  • Fika Ventures was set up in 2017 by general partners Eva Ho and TX Zhuo

Fika Ventures, a Los Angeles, California-based venture firm, announced it has established a $76 million sophomore investment fund to help grow local startups. According to TechCrunch, Fika Ventures has invested in about half of its capital exclusively in startups that are based out of LA.

Founded in 2017, Fika Ventures was established by general partners Eva Ho (former general partner at Susa Ventures) and TX Zhuo (former managing partner at Karlin Ventures). When the venture firm was first established, its first fund hit $41 million.

What does Fika mean? In Sweden, “fika” is considered a cultural activity where a cup of coffee is shared with friends. Essentially, it is a moment to take a break and is an informal way of getting to know someone without pressure.

Last year, more than $60 billion was invested in LA-based startups — which is considered a record high. And this year, companies based in LA have brought in about $25 billion in equity funding (Pitchbook).

“It’s still really underserved from a capital standpoint,” said Zhuo about investments in the LA region via TechCrunch. “We feel over the next couple of years, we’ll start to see repeat entrepreneurs come out of these LA companies. The timing is ripe for a fund like ours to capitalize on the opportunity.”

Ho told TechCrunch that the region is benefitting from founders and investors leaving Silicon Valley who are moving down south. In the last two decades, the startup ecosystem has been especially growing in LA.

Ho is also known as being one of the co-founders of AllRaise — which is a nonprofit that helps women and women of color gain leadership roles at venture capital firms.

Fika Ventures primarily invests in enterprise and fintech companies. But they have also invested in companies that are addressing social issues. For example, Fika Ventures invested in WeeCare — which helps people set up curriculum-based daycares within their own homes.

Fika generally takes a 5% ownership in each of the companies it invests in. With this funding raise, Fika is going to increase its average initial investment from $500,000 to $1 million and it could go up to $1.5 million reported the LA Business Journal.

And Fika Ventures also invested in Asian food delivery company Chowbus, a robot assistant developer called Elementary Robotics, and a customer support messaging service called Chatdesk. One of Fika’s most successful investments was OpenPath Security — which has now raised a total of more than $27 million.

Besides Zhou and Ho, the team at Fika also includes Principal Matt Hersh and Principal Andrea Funsten.