Last month, Volition Capital, a 13-year-old, 30-person Boston-based growth equity firm, announced it has closed its fifth fund with $675 million in capital commitments, bringing its total assets under management to $1.7 billion.
While most VCs will tell you they had no problem raising their newest fund, Volition co-founder Larry Cheng — an alum of Bessemer Venture Partners, Battery Partners and Fidelity Ventures — says that wasn’t his experience when trying to raise the firm’s latest vehicle. In the fourth quarter of last year, he says of Volition’s limited partners, “I don’t think anyone really knew — even the folks that we were interacting with — whether they could come in for the amount they originally wanted, or whether they were going to come in at all.”
That they did show up with their checkbooks isn’t shocking. Among Volition’s other exits, the firm famously invested early in the pet marketplace Chewy, which later sold to PetSmart for a whopping $3.35 billion in 2017 before being sold to other buyers in 2020. In fact, Cheng — who remains focused on internet and consumer deals while others of his partners are more focused on enterprise software — has remained so close with Chewy founder and meme-stock king Ryan Cohen that he’s on the board of GameStop, which Cohen chairs.
A few days ago, we talked with Cheng a bit about that friendship. We also talked about some of Cheng’s more current, contrarian bets like adtech. Our chat has been edited for length and clarity.