Startup studio super{set} has achieved another successful exit with the sale of marketing company Habu to LiveRamp for a whopping $200 million in January, adding to its impressive track record. But that’s not all – the studio has also secured an additional $90 million, doubling down on its strategy of building enterprise startups.
“In some ways, very little has changed since our launch. We remain a venture studio focused on building companies rooted in data and AI. We found, fund and build new technology startups, mostly in the enterprise space,” said founding managing partner Tom Chavez in an interview with TechCrunch.
While super{set} has stayed true to its mission since its inception, the market around it has shifted, and Chavez feels vindicated in their approach. As TechCrunch reported in the past, the studio’s focus on “admittedly boring but bountiful products” has turned out to be a solid bet. In total, it has secured a staggering $176 million in funding up to this point.
Although there are numerous venture studios in the industry, super{set}’s unique edge lies in the fact that it is run by highly experienced builders with a proven track record of their own.
While the studio is backed by external investors including family offices and tech investors, a significant portion of its capital comes from Chavez and his fellow founding managing partner, Vivek Vaidya. The two have a history of launching successful companies, such as Krux which was later sold to Salesforce, and Rapt which was acquired by Microsoft. Together, these two exits amounted to a whopping $1.2 billion, and now the pair is investing some of their earnings into super{set}.
“Our investors appreciate that. They understand that we are perfectly aligned in terms of our outcomes and investments. Additionally, we are fortunate to have a diverse base of LPs who bring invaluable expertise and ask crucial questions about our operations,” said Chavez, highlighting the unique collaboration between the studio and its investors.
While super{set}’s focus on AI remains unchanged, it sets itself apart from other investors who primarily back foundational AI. Instead, super{set} is more interested in what it refers to as “the engineering of AI.”
“The LLM substrate creates a great opportunity for us to engineer useful applications that draw on these kinds of systems,” Chavez explained, referring to the growing interest and innovation in large language models.
While entrepreneurs could attempt this on their own, super{set} offers them an alternative to tirelessly seeking funding for an unproven idea. Chavez added, “We eliminate the need for that hustle, allowing the teams to focus on their product and customers.”
Venture Studio, super{set} Style
A more challenging fundraising environment can provide a tailwind for venture studios and not just because it’s easier to attract entrepreneurs. Investors also like the assurance that the studio will be able to retain a significant share if the company becomes successful.
However, there is a fine line between having enough ownership and having too much ownership, especially when the added value of the studio is not clear. The venture studio space varies widely, but according to Chavez, super{set}’s model is “quite different from what most venture studios are doing.”
One significant difference is the volume: with 16 companies in its portfolio, super{set} is much more hands-on than studios that create a dozen companies each month. The studio plans to even lower the number of companies it forms to two or three per year, compared to its initial goal of four or five.
The pair is selective when it comes to pursuing new ideas. To decide whether an opportunity is worth pursuing, they use a “solution memo,” which is their version of a typical venture capital investment memo. This is one aspect where super{set} has evolved since 2019, shifting from a more intuitive process to a more analytical and data-driven approach.
Whether it’s science or craft, Chavez and Vaidya have a keen eye for selecting the right people to work with, according to limited partner Alex Bangash. Bangash’s VC fund, Transpose Platform, has several startup studios in its portfolio.
“Tom and Vivek are not only focused on finding the right talent, but also identifying those who have the potential to become co-founders and nurturing and elevating that talent alongside their company,” said Bangash.”
Once an idea is validated, super{set} finds a co-founder with a strong focus on the product. At this point, the studio’s role shifts from hands-on to more guidance as time goes by, without any specific end date like in an accelerator program. In the initial stages, super{set} provides support in areas such as recruitment, marketing, sales, and fundraising.
The teams and companies under super{set} also have the opportunity to work from the studio’s brand new space, located on the entire fourth floor of San Francisco’s iconic 140 New Montgomery building, which is also home to Greylock, a leading VC firm. Despite growing up in Albuquerque, Chavez moved to San Francisco 30 years ago and is optimistic about the city’s potential, particularly in the current age of the “AI revolution.” Super{set} intends to continue leveraging this potential.
