The Unusual Way Charlie O’Donnell Raised His New $3.5 Million Fund

Charlie O'Donnell startup 2011
Charlie O’Donnell, Brooklyn Bridge Ventures

In January, Charlie O’Donnell left his role as Principal at First Round Capital. He announced a new fund he’d be pursuing, Brooklyn Bridge Ventures.Now O’Donnell has raised the first chunk of that fund, totaling $3.5 million.

LPs include Two Sigma Ventures, KEC Holdings, partners at FRC, Wilson Sonsini, Wiley and Allison Cerilli, David Rose, Tom Wisniewski, Chad Stoller and Ramesh Haridas.

Wiley Cerilli, founder of SinglePlatform, was one of the entrepreneurs O’Donnell advised at FRC. Cerilli recently sold his startup for $100 million, so his investment in O’Donnell’s new firm is recycled capital.

O’Donnell isn’t announcing any startup investments yet, but he says six deals are in the works right now. Three of the six startups are based in Brooklyn. O’Donnell’s only real thesis is to invest in companies that are in their infancy. He’ll be investing a few hundred thousand dollars in each.

“Raising this fund was a real learning process for me,” says O’Donnell. “I’ve never been expose to a fund fundraising. It was my first time going through it and seeing how all the stocks are structured. And it’s a new world to network in.”

To raise the $3.5 million, O’Donnell says he turned over every rock. He met one potential investor through Twitter. He went after individuals who were interested in alternative investing and who didn’t frequent tech headlines.

“Some of the best introductions I’ve gotten [to potential LPs] have been from founders who had to raise money when New York wasn’t such an investor hot bed,” he says. “Older founders and investors knew about other pools of money.”

O’Donnell was surprised how similar raising a fund was to raising a round as an entrepreneur.

“A lot of it is Sales 101,” says O’Donnell. “You have to be very good at qualifying leads and understanding the customer. I found myself thinking about it more like finding leads in the top of a funnel, qualifying leads, and then converting them to sales. It’s easy to say, ‘Oh sure, I know a ton of people. But thinking of raising money as sales forces you to come in every day and say, ‘What can I do to add to this funnel?'”

O’Donnell will be working from Brooklyn. His team includes a virtual assistant, a virtual CFO and a lawyer who’s based in an incubator. “#LeanVC,” he says.