Dorm Room Fund returns to campus with new $10.4 million fund

Dorm Room Fund, a venture capital operation that launched to invest in student-led startups, has raised a new $10.4 million fund, per SEC filings. The filing marks Dorm Room Fund’s largest fund to date, and its first that appears to include investors beyond First Round Capital, the firm that first launched the student-focused operation in 2012. The SEC filing indicates that the fundraise is still ongoing. Both firms declined to comment.

Dorm Room Fund’s original vision was tied to First Round Capital’s bet that early-stage investing could be led by students, for students. In 2012, First Round Capital thus allocated a portion of its assets under management -- a $3 million capital pool -- to be managed by a group of students. Today, Dorm Room Fund continues to still only invest in companies where at least one person on the founding team is a student or recent graduate.

Dorm Room Fund has made 326 investments to date, in startups such as Brooklinen and Snackpass -- as well as venture firm Harlem Capital Partners. On its website, the operation says it writes $40,000 SAFE notes into the startups it backs -- and has teams in New York City, San Francisco, Boston and Philadelphia.

While the operation's focus is largely in the United States, we have some signals its checkwriting focus may be broadening: Dorm Room Fund’s latest investment, per Crunchbase, was in a pre-seed round for Alima, a Mexico City-based company that wants to make product procurement easier for businesses.

For Dorm Room Fund, which had been noticeably quieter in its investment activity over the past few years, fresh capital could give a boost to its student-focused operations. As the larger investing world gets more competitive, investors are incentivized to find talent sooner and sooner -- either through in-house accelerators, non-dilutive programming or, in this case, a carved out microfund explicitly for aspiring entrepreneurs.

The strategy may feel especially relevant today, but there is precedent. Similar to Dorm Room Fund, General Catalyst launched Rough Draft Ventures as a play to get more access to student networks. Contrary Capital, another student-focused venture capital firm, recently announced a $20 million fund -- its second investment vehicle to date. In 2019, First Round made another move in favor of early talent: it supported the Graduate Fund, a pre-seed fund that targets recent graduates of undergraduate or master’s programs but that operates independently.

Dorm Room Fund appears to have been gearing up for a refresh of sorts. In 2018, the team launched a CRM for founders raising a seed round, but a year later the firm’s CEO Rei Wang left their post to launch The Grand, a learning and development platform to help people navigate change. That same year, the team hired Molly Fowler, who previously worked in politics and urban planning, to be the new chief executive. It also brought on Chauncey Hamilton as its inaugural COO, who was previously the chief of staff to First Round partner Rob Hayes, who then left for join XYZ Venture Capital after a little over a year. Still, with some new leadership, Dorm Room Fund has seemed to convince a cadre of LPs that its longtime focus deserves fresh capital.