Outspoken tech investor Dave McClure helped fund 1,800 early-stage companies in 60 countries as the chief executive officer of 500 Startups—until he stepped down two years ago in a sexual misconduct scandal that roiled the industry. Now, both McClure and the VC firm he co-founded are taking steps to rebuild themselves, this time without one another.
It was 2017, when McClure abruptly resigned from 500 Startups, retreating from the spotlight amid allegations from women that he’d behaved inappropriately. He acknowledged he’d made advances toward multiple women in work-related situations in a since-deleted blog posted titled “I’m a creep. I’m sorry.” He handed the leadership reins to his 500 Startups co-founder, Christine Tsai. No legal action was taken against McClure or the firm.
Today, McClure is working on a second act, albeit a lower-profile one. He’s raising a new fund to invest in other venture firms worldwide, according to two people familiar with the plans. McClure declined to comment for this story.
With the working title Practical Venture Capital, McClure’s new effort will be vastly different from the early-stage venture work he built his career on, said the people, who asked not to be identified because the matter is private. The new fund is designed to purchase stakes in smaller funds, sometimes called micro-venture capital firms and also buy stakes from those funds’ investors when they’re seeking liquidity. The initial target for the fund is $100 million, although the final amount could be larger, the people said.
McClure is the latest in a string of male venture capitalists unseated in the #MeToo movement who are now attempting to re-enter the industry by starting a fresh venture fund. Fred Destin, a former Accel and Atlas Venture partner, moved to Europe and helped raise more than $50 million for a firm called Stride.VC last summer. In 2017, a startup founder accused him of making unwanted advances at a party several years earlier; Destin said at the time he misread the situation and had never used his position as a VC in an inappropriate way. Steve Jurvetson, who parted ways with Draper Fisher Jurvetson a little more than a year ago, raised a new $200 million fund called Future Ventures last month. Jurvetson had stepped down amid misconduct allegations, which he strenuously denied. The VCs follow other public figures accused of misconduct, including comedian Louis CK and Pixar co-founder John Lasseter, who have made controversial bids to reclaim their careers.
