Yahoo Finance Former Salesforce Co-CEO Keith Block Launches Venture Capital Firm
(Bloomberg) -- Former Salesforce Inc. Co-Chief Executive Officer Keith Block is launching a venture capital firm, targeting $400 million for its first fund.
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The new firm, known as Smith Point Capital LLC, will invest in enterprise software, particularly at the growth stage. Smith Point expects about 75% of the new fund to be deployed in companies with $50 million to $250 million in annual recurring revenue.
In an interview with Bloomberg News, Block said the firm has done a first close on the fund.
Block said he believes now is a good time to invest because valuations have come down and “CEOs are desperate for guidance.”
“There has never been a better time to invest in software than there is right now,” he said.
ServiceNow Inc. will serve as the firm’s anchor investor and strategic partner. Hillman Co., Solamere Capital, Carnegie Mellon and billionaire investor David A. Tepper have also invested in the fund.
Smith Point’s co-founders include software industry veterans Burke Norton, who worked most recently at Vista Equity Partners, and Chris Lytle, who worked at family office Longfellow LP.
The firm is launching the Smith Point Precision Advisory Network, which will facilitate advice from industry executives to portfolio companies.
Block also offered some advice for the industry. He said he believes that many technology businesses will come to regret the current flurry of layoffs. In his view, job cuts should usually be based on performance, and not job function.
When the market improves, he said, “I guarantee those companies are going to have to hire those people back.”
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