- On Thursday, Vice Ventures announced it raised its first $25 million fund to back early-stage companies in highly regulated “vice” industries like alcohol, marijuana, and e-cigarettes.
- The fund was created by Catharine Dockery, a former Walmart executive, and has backing from Bradley Tusk and Marc Andreessen.
- Tusk told Business Insider that he was impressed by Dockery’s “aggressive and ambitious” approach to running her own fund, and felt that his experience in navigating uncertain regulatory waters would be helpful to Vice Ventures’ portfolio.
- Tusk said he would have hired Dockery “outright” for his own firm, Tusk Ventures, but believes the long-term partnership will help accelerate funding for early-stage companies facing compliance challenges that are traditionally overlooked by other investors.
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A little vice won’t scare away Bradley Tusk.
The political-strategist-turned-venture-investor thinks he can help early-stage startups navigate the murkiest of regulatory issues, and has advised insurance startup Lemonade, sports betting site Fanduel, and marijuana delivery service Eaze, among others.
Last week, he took his self-described “marginal approach” a step further by backing Vice Ventures’ first $25 million fund. As the name suggests, Vice Ventures primarily makes early-stage investments in those industries that more traditional VC firms often turn away from — marijuana, sex tech, alcohol, and e-cigaretttes, among other areas.
Tusk says these areas are typically overlooked because of “vice” clauses some firms have with existing limited partners that restricts the type of industries they can invest in.
“I liked the category because there’s so much regulatory arbitrage there,” Tusk told Business Insider. “A company can be incredibly successful around these spaces but there’s lots of regulatory risks to deal with, so it will come down to how savvy you are and how you handle this stuff.”
According to a VentureBeat report, Vice Ventures plans to invest around $500,000 in each of its portfolio companies, and has already invested in CBD beverage company Recess, Founders Fund-backed alcohol company Bev, and cannabis vaping creator Indose.
‘I would have just hired her outright’
New-York-based Vice Ventures is the brainchild of Catharine Dockery, a former Walmart executive that led private investments for former Bonobos CEO Andy Dunn.
Read More:This New York investor just raised a $60 million fund to capitalize on what he sees as a big weakness in the Silicon Valley VC firms
“I would have just hired her outright but I like that she was so aggressive and ambitious. She wanted to do her own thing,” Tusk said.
As a former campaign strategist and Uber’s first political strategist, Tusk is well aware of the compliance and regulatory hurdles many of these companies will face as they expand into new markets, and was eager to partner up with Dockerty to identify promising young companies and help them grow.
To that end, Tusk said that his personal investment in Vice Ventures will help build a strategic partnership with his venture firm Tusk Ventures. Where Tusk Ventures usually targets startups that already have some traction, Vice Ventures is currently looking to write smaller checks at the pre-seed and seed stages.
Furthermore, Tusk says, he’s excited to be a part of what stands to be one of the very few women-led venture capital funds in Silicon Valley.
“Everyone in tech talks a big game about diversity and female founders, so this was a chance to put my money where my mouth is,” Tusk told Business Insider. “You can say all that stuff but until you do it, what does it mean? Nothing.”