Alpha Partners reached a significant milestone with the announcement of its $153 million third fund, as reported by TechCrunch. This is nearly three times the size of the firm’s second fund, which closed at $52 million in 2017. It also underscores Alpha Partners’ continued growth and commitment to its unique strategy of supporting early-stage VCs by helping them exercise their pro-rata rights and preserve equity in their most promising portfolio companies.
Since launching Alpha Partners in 2014, Managing Partner Steve Brotman has honed a model that continues to resonate in the evolving venture capital landscape. While traditional methods such as opportunity funds and special purpose vehicles (SPVs) have gained popularity, Alpha’s focus on pro-rata investments has become especially relevant in today’s difficult environment.
According to Brotman, the venture landscape has shifted since the last VC boom ended, with opportunity funds falling out of favor and SPVs encountering challenges. Yet, Alpha Partners has remained a “safe pair of hands” for early-stage VCs seeking to maintain their ownership in companies as they scale from Series B and beyond.
The success of Alpha’s strategy is evident not only in the growth of its funds but also in its impressive portfolio. Recent investments include AI-driven platforms like Pearl and Rad AI, as well as defense tech startup Shield AI. The firm has previously backed companies such as Coursera, Rover, and Coupang, where its pro-rata rights paid off with significant returns, including a standout 20x investment on Coupang.
Alpha Partners typically writes checks between $5 million and $10 million, partnering with top-tier VCs and focusing on companies with strong growth trajectories, often exceeding $10 million in revenue with 50% annual growth rates. Despite the fast pace of these deals—where Alpha often has just a couple of weeks to make decisions—Brotman remains confident in the firm’s ability to identify winners quickly and efficiently.
“What’s often said about venture capital is ‘it’s not an asset class, it’s an access class,’” Brotman told TechCrunch. “We provide our LPs access to the top 1% of all deals out there.”
As Alpha Partners continues to grow and strengthen its presence in the venture ecosystem, this latest fund solidifies the firm’s position as a key player in pro-rata investing. It also positions Brotman and team to drive even more success stories in the coming years.
