Wen Hsieh and Haomiao Huang, both Kleiner Perkins investors, left the firm in 2023 to start their own venture capital fund called Matter Venture Partners. The company had backing from Kleiner and Taiwanese chipmaker TSMC.
Hsieh was a long-time KPer, having been there for 17 years. Huang was there for four years. With a passion for what he calls “hard technology,” Hsieh has invested in companies such as microLED display technology company LuxVue, which was acquired by Apple. Amprius, which makes high energy density lithium ion batteries. drone manufacturer DJI; and 3D printing company Desktop Metal, which went public through a SPAC in 2020. Huang and Hsieh have co-led investments in companies such as robotics company Dexterity and CT scanning company Lumafield.
On Thursday, they announced the closing of a $300 million seed fund. Hsieh told TechCrunch that it is considered to be one of the largest “first funds” raised in 2023. medium enterprise fund raised that year was about $37 million, according to a PitchBook-NVCA Venture Monitor report.
Matter Venture Partners was originally going for a $200 million fund, and Hsieh acknowledged that “it was a tough time for everyone” — startups and venture capitalists alike — to raise money in 2023.
“We had gone into this anticipating such difficulty and had very modest expectations,” Hsieh said. “But to our surprise, it did really well for us. We closed $300 million last year, in total, and they were significantly oversubscribed.”
Knowing when to say “when”
Finding the best amount to close the fund is a bit like being “Goldilocks,” Hsieh said. Matter Venture Partners invests in large seed rounds, Series A and Series B.
Wen Hsieh, co-founder of Matter Venture Partners. Image Credits: Matter Venture Partners
If a fund is undercapitalized, it may not be able to be competitive in deals or support portfolio companies in multiple rounds, he explained. Over capitalized and may have too much money to grow within a two or three year capital cycle. This could also result in writing too many checks or check sizes that are too large for proper fundraising.
He believes Matter Venture Partners’ focus on hard technology was the reason for the oversubscription. “The world has realized that most if not most of the fundamental technologies and trends in our society today are based on hard technology,” he said. “This really puts the wind behind us. We came out successful and unscathed in a very positive way and we’re very lucky to have raised money at a difficult time.”
In addition to Kleiner LP and TSMC, individuals, entrepreneurs and family offices also support the fund. Hsieh, Huang and operating partner Mel Tang are also LPs in the fund.
Leverage operating partners
Matter Venture Partners provides a unique aspect of having operating partners, which Hsieh said is usually something only larger firms have. One is Mel Tang, former CFO of video doorbell company Ring, which was later acquired by Amazon.
Tang has experience in operations, supply chain management and manufacturing unit finance, and Hsieh believes that expertise like this from early in the life of a hard-tech startup is a good value-add.
As for how Matter Venture Partners works with founders, the partners say they pride themselves on being company builders, but not at the expense of getting in the way of founders, Hsieh said. They love to coach, partner and jump in, all where needed.
All about hard technology
Haomiao Huang, co-founder of Matter Venture Partners. Image Credits: Matter Venture Partners
They placed “hard technology” into six buckets: ubiquitous semiconductors, labor shortage robotics, generative artificial intelligence, on-shoring manufacturing and friendly shoring, energy building blocks, and life sciences automation.
“The common theme around these six sectors is that we like to invest in the next ‘picks and spades’ for all six of these trends,” Hsieh said. “There are a lot of gold rushes going on, but we’d like to provide the ‘picks and shovels’ just in case. We like to fund them and the entrepreneurs who contribute to these new innovations.”
So far, Matter Venture Partners has invested in six companies that have yet to go public. It also doubled down on some that came from the pair’s Kleiner Perkins days, including Ambiq Micro, a company that Hsieh describes as a “key player in cutting-edge artificial intelligence,” which is a concept of making AI workloads easier to run.
“It’s all about low power,” he said. “The big debate is how much energy does it take to conclude or how much energy to train? Ambiq is a world leader in ultra-low power chip manufacturing. They dominated wearables and are now using it in cutting-edge AI applications. The product is having a huge impact and we are driving a new wave of awareness for energy efficient AI.”
Ultimately, Matter Venture Partners will invest in 15 to 20 companies with the new fund, Hsieh said.
