How Nichole Wischoff Won The Internet To Raise $50 Million For Her VC Firm

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The prolific online poster at Wischoff Ventures plans to write checks of $1 million or so into startups in areas like the “new supply chain” from her Nashville-based fund.

Read the full story on Forbes: https://www.forbes.com/sites/alexkonrad/2024/09/04/nichole-wischoff-wins-internet-and-50-million/

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Transcript
00:00Today on Forbes, how Nicole Wischoff won the internet to raise $50 million for her VC firm.
00:09When shopping startup Checkmate went viral in December 2022, its little team was caught
00:14by surprise.
00:16Their app, which offers personalized deals to users, promised a cashback bonus for referring
00:21new users.
00:22As it soared to the top slot in Apple's App Store, bots swarmed the program, and Checkmate's
00:27back-end software couldn't keep up.
00:30Human shoppers who didn't see their bonuses started filing thousands of customer support
00:34tickets to complain.
00:36One of Checkmate's co-founders vomited from the stress.
00:39Another, CTO Rory Garton-Smith, started having panic attacks.
00:44Then, he called Nicole Wischoff.
00:47The founder and sole general partner at Wischoff Ventures, Wischoff was a late addition to Checkmate's
00:52cap table, a so-called, quote, wild card, who had shouldered her way into its $5 million
00:58seed round through her hustle and promise of operational help.
01:02Just three months later, she proved it.
01:05Her fortitude in the face of crisis and her advice, hire an operations expert and over-communicate
01:10with users, helped Checkmate weather the storm.
01:14Garton-Smith, who asked Wischoff to join his board as an observer following the crisis,
01:19said, quote,
01:27Checkmate's story is unusual for Wischoff only because it's a consumer startup in a
01:31portfolio of mostly business-to-business companies.
01:34Otherwise, in the four years since she started investing, Wischoff is used to punching above
01:39her weight.
01:41Investing out of past $5 million and $20 million funds, she's backed 40 companies to date.
01:47And on social media, she now counts nearly 90,000 followers on X and 40,000 on TikTok,
01:53the vast majority gained in recent years, who tune in for a mix of company building
01:57and personal insights.
01:59Now, Wischoff Ventures has raised $50 million for its third fund, the investor exclusively
02:05told Forbes, tripling its assets under management after previous fund sizes of $5 million and
02:11$20 million to date.
02:13The fund will look to invest $800,000 to $1.6 million in 30-plus startups, seeking
02:19ownership of between about 7% and 10%.
02:23A generalist fund, Wischoff said her firm will continue to focus on mostly enterprise
02:28companies, particularly in fintech, logistics, and manufacturing.
02:33She's also hired a senior associate, Neil Mintz, to join the firm's budding investment
02:37team.
02:39Wischoff's focus areas, and success so far, are no surprise to her supporters, a combination
02:44of overcoming a difficult personal background and leveraging her own experience across multiple
02:49startup roles.
02:51The fifth of seven siblings, Wischoff grew up in financial insecurity in central New
02:55York.
02:56In and out of public housing, and without consistent access to food and clean clothes,
03:01Wischoff was a poor student, she said, until she spent a year in Belgium with a host family
03:05that encouraged her to study and join her host mother in distance running.
03:10Back home for a fifth year of high school, she impressed the cross-country coach at nearby
03:13SUNY New Paltz, who threw her a lifeline to compete for his college.
03:18Relatively early in her career, in San Francisco, she caught the startup bug, joining mortgage
03:23software startup Blend to work closely under its CEO on special projects.
03:29Years later, after writing personal checks into several fellow Blend alumni-led startups
03:33in 2020, a venture capitalist told Wischoff she should consider raising a small fund of
03:38her own.
03:40Under the mentorship of Midas List investor Lee Fixel, and others, she sought $1 million
03:45and quickly raised $5 million to invest part-time.
03:49Wischoff made 26 investments from that first fund, with an average check size of $150,000
03:56and 16 markups, good for a gross internal rate of return, or IRR, so far of about 20%.
04:03She raised her larger, second fund in 2022.
04:07That fund backed 15 companies at an average $650,000 check size, for an IRR, so far, of
04:1426%.
04:15In unusual transparency, Wischoff has shared many details around her performance to date
04:20publicly on social media.
04:23For full coverage, check out Alex Conrad's piece on Forbes.com.
04:29This is Kieran Meadows from Forbes.
04:31Thanks for tuning in.
04:53Transcribed by https://otter.ai

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