Exclusive: AlleyCorp raises a $250 million fund, taking on external investors for the first time

AlleyCorp has already incubated MongoDB, Gilt Groupe, Business Insider, and Zola. But the firm, led by longtime serial entrepreneur Kevin Ryan, aspires to more.

"The role model for us is actually a Venrock or a Bessemer,” Ryan told me over Zoom. “Very established VC firms, yes, but people forget they were originally family offices. Then, to make it more sustainable and long-term, they started taking outside investors every three to four years.”

And AlleyCorp is exactly at that moment right now, taking on outside investors for the first time. AlleyCorp has raised a new fund of about $250 million, Fortune has exclusively learned. It’s technically a first-time fund, though it’s an off-kilter label given AlleyCorp’s track record. To date, the firm—which frequently writes first checks—has deployed more than $375 million across north of 180 companies. The majority of the firm’s past investments were personally funded by Ryan, and those companies have gone on to raise more than $3 billion in follow-on capital.

“It’s a first-time fund from an outside investor point-of-view,” said Ryan. “But we’ve already invested hundreds of millions of dollars over ten years. So, we have a much longer track record that just wasn’t part of an outside fund. Everyone finally got to see that track record when they were looking at investing, which I think is why they made an exception this year and invested in a new fund.”

Ryan has cofounded dozens of companies, including MongoDB, Gilt Groupe, Business Insider, Pearl Health, and Transcend Therapeutics. But he made his name as the CEO of DoubleClick, helping shepherd the company from 20 employees to 1,500, and a $1.1 billion sale to private equity firm Hellman & Friedman in 2005 (Google later acquired DoubleClick for $3.1 billion).

Previous investments from the AlleyCorp team (including Ryan’s personal investments) have generated more than 50% IRR, sources familiar with the matter told Fortune.

Fortune’s editor-in-chief Alyson Shontell worked with Ryan at Business Insider, starting when she was 22 and staying for a decade. I asked Shontell about Ryan via Slack:

“What I remember most is his approachability and support of my career from the time I was an entry-level employee to Editor-in-Chief—and that he is highly competitive and not someone you want to let down,” Shontell told me on Slack. “He used to play on the AlleyCorp intramural soccer team with us, and if you messed up a shot on goal or an assist, he certainly let you know and pushed you to do better!”

That reflects in how he approaches founders, says Blake Mandell, cofounder and CEO of Transcend Therapeutics, a clinical-stage biotech company developing rapid-acting treatments for neuropsychiatric disease.

“For people he works with, he provides direct feedback to help people grow. I can't count the number of times I've heard him say ‘a great CEO makes themself irrelevant’,” said Mandell.

Ryan is also a longtime champion of New York City’s tech scene. He’s been a fixture in the city since the mid-90s and launched MongoDB, Gilt, and Business Insider there.

AlleyCorp invests across the country (and sometimes internationally) but New York remains important to the firm’s strategy. Moving forward, AlleyCorp’s strategy will stay the same, the firm says. But I’d argue there is something that’s changed: Ryan’s upping the ante, and AlleyCorp is now chasing the longevity of a Venrock or Bessemer (firms that have been around for more than 50 and 100 years respectively).

“This is a firm that should be around 20 years from now,” said Ryan. “I may not be around 20 years from now, but AlleyCorp should be. There’s no reason we can’t leverage this portfolio and this knowledge to build a really sustainable firm.”

See you tomorrow,

Allie Garfinkle
Twitter: @agarfinks
Email: alexandra.garfinkle@fortune.com
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This story was originally featured on Fortune.com