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7GC closes in on fourth deal for debut vehicle as $150m fundraise continues

October 3, 2018

Newly launched VC 7 Global Capital has closed its fourth deal for its debut fund, after investing in pharmaceutical start-up hims, AltAssets understands.

Hims is a telehealth platform for prescribing drugs for men’s wellness. The deal, which is currently being processed, is expected to close soon. 7GC joins existing investors IVP and Founders Fund in the round, a source with knowledge of the matter said.

7GC declined to comment on the potential deal, but a source familiar with the fund told AltAssets the firm was making strong inroads to finishing its debut fundraise next year.

According to the source, the firm is targeting $150m for its maiden fund, and secured $75m for its first close last year. It is believed that the firm is expecting to reach the final close for the vehicle between the first and second quarters of 2019.

German broadcaster ProSiebenSat.1 Media SE are are one of the strategic LPs in the new fund according to its annual filing. 7GC’s other limited partners include industrial families, digital entrepreneurs, business leaders, private and publicly traded corporations in the United States, Europe and globally.

The firm has also banded together a group of former colleagues and digital entrepreneurs to commit to the fund as LP.

7GC’s debut fund is already about 50 per cent invested, and is expected to invest in 12 to 15 assets once the fund is fully deployed.

The hims investment would be the fourth deal through the fund, which has also invested in Capsule, Cheddar and a basket of secondary assets. The firm usually writes cheques for between $3m and $10m per business.

7GC, which is based in Berlin and San Francisco, recently participated in the $50m Series B funding round for Capsule, which is set to use the financing to expand to other US cities.

After launching the firm last year, 7GC has set about building its team including a new partner in San Francisco, Jack Leeney told AltAssets.

“If we were an entirely US fund with just US capital and we were looking at the opportunities we are looking at, we wouldn’t get in the door.”

“This is the most competitive stage of the venture market which we are tracking, so it’s the price adjusted assets that are doing incredibly well. How we’re able to play in this incredibly competitive band is by delivering is that connectivity to Europe. It really is bespoke to each asset depending how we can help them partner.”

When describing how 7GC sees the market currently, Leeney said, “I think there’s great appetite in Europe for growth, which is fantastic because in the last five years it’s come a very long way let alone ten years.

“There’s always been a very healthy appetite and appreciation for private equity investing here [Europe] yet venture because of local landscape coming into maturation has not historically been something people are 100 per cent spending all their time and efforts on, and that’s has changed dramatically now.”

“Every private investor is searching for yield right now and this is an environment where a lot of different alternatives are increasingly looking like a great option.”

“The very clear task for us, was ‘go articulate the thesis’. This is a very ambitious strategy as far as the assets you’re targeting, the people you’re co-investing with and really some of the most competitive opportunities in the US and in the venture world.”