Spark Raising $375 Million Growth Fund After Twitter Win

Spark Capital, an early investor in Twitter Inc. (TWTR) and Oculus VR Inc., is aiming to raise a $375 million fund to back later-stage startups.

The firm submitted a filing yesterday for Spark Capital Growth Fund LP, and listed partners Paul Conway, Todd Dagres, Bijan Sabet and Santo Politi as principals, along with Jeremy Philips. No money has yet been raised for the fund, according to the filing with the U.S. Securities and Exchange Commission.

Spark, founded in 2005 and based in Boston, has been at the forefront of social-media investing, backing Twitter in 2008 and holding a 6 percent stake after last year’s initial public offering. Like Union Square Ventures in New York, Spark has established itself as a prescient predictor of Internet trends even though it’s located across the country from Silicon Valley.

While the filing has no description for the new fund, venture firms typically raise growth funds so they can write bigger checks to companies that have a working business model and need cash to expand, as opposed to early stage funds, which often bet on small teams that have yet to generate revenue. Last year, Spark brought in $450 million for its fourth venture fund.

“Our sweet spot is early stage startups, generally the first venture round, with a focus on Internet and mobile investments,” Spark says on its website. The site also says that the firm will invest as much as $25 million “to help an emerging winner establish category leadership.”

In addition to Twitter, Spark was an early backer of Tumblr Inc., which Yahoo! Inc. bought last year for $1.1 billion. And Spark parlayed an investment of about $19 million in Oculus, a maker of virtual-reality goggles, into a stake worth about $380 million, after Facebook Inc. agreed to acquire the company earlier this year, people with knowledge of the deal said in March.

Spark partners didn’t return calls and e-mails for comment.

To contact the reporter on this story: Ari Levy in San Francisco at alevy5@bloomberg.net

To contact the editors responsible for this story: Pui-Wing Tam at ptam13@bloomberg.net Jillian Ward, Ben Livesey

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