Solo-GP firm Accelerator Ventures revs up for first fund

Alexander Lloyd was an angel investor for 10 years before he decided to launch Accelerator Ventures, which is targeting to raise $10 million for its inaugural fund. Lloyd has raised $5.75 million to date from friends and frequent co-investors on seed stage deals.

Lloyd has so far received commitments from six undisclosed individuals, and he says that he won’t look to raise institutional capital until he’s built up more of a track record.

“All my LPs are people that I’ve had a direct relationship with and known for years,” he says. “A first-time fund with a single GP isn’t exactly what every institutional investor is looking for.”

Accelerator has made one investment. It participated in an $800,000 financing for San Francisco-based RateItAll, an online customer review service. Other investors included JAIC America, Pacific I&T Ventures and Eric Di Benedetto, a general partner at Convergence Partners.

Lloyd, a former venture partner at Rustic Canyon Partners, says that RateItAll is typical of what he wants to invest in and what VC firms are prone to dismiss. Accelerator focuses on seed consumer technology companies and hopes to catch startups with capital requirements too small for larger, more institutionalized VCs, Lloyd says.

“Given their revenue and growth numbers, we figure that they’ve raised all the money they need to raise,” Lloyd says of RateItAll. “They’re becoming a valuable property that we’ll eventually be able to sell.”

Lloyd worked as a business development manager in Microsoft’s Silicon Valley office before getting into venture capital. There, he was responsible for making Microsoft more user-friendly to venture capital firms and startups. Among his investments as an angel investor, Lloyd backed online advertising space broker Ad ECN, which was bought by Microsoft in July 2007 for an undisclosed amount.

Jon Staenberg, a former colleague at Rustic Canyon, says that Lloyd seems to have a “good nose for early stage deals and has a good track record.”

Accelerator is one of a growing number of solo-GP firms investing in seed stage deals too small for most VCs to look at. Lloyd’s fund development plan—raise money from friends and co-investors now to establish a track record before hitting up institutional LPs—is a similar path that others have traveled.

Mike Maples Jr., for example, operated an investment fund backed by about a dozen former cohorts, before he reached out to institutions. In April, Maples closed his second fund at $33 million, raising cash from Horsley Bridge, the University of Chicago and Weathergage Venture Capital.

Other solo-GP firms include Jo Tango’s Kepha Partners, Jeff Clavier’s Softech Ventures, Vince Vanelli’s KPG Ventures and Dave Whorton’s Tugboat Ventures.