Bloomberg to set up a $75-million venture capital fund

Bloomberg L P. plans to set up Bloomberg Beta, a $75 million venture capital fund, to invest in young start-ups like Codecademy, a website that provides online coding tutorials, and Newsle, a Web service that alerts users to news about friends, NYTimes.com reported.

This fund will invest in and create early-stage technology companies. Bloomberg Beta, in keeping with Bloomberg L.P.’s longstanding pattern of entrepreneurialism, is focused on backing and working alongside exceptional founders. Bloomberg Beta exists to expand Bloomberg L.P.’s horizons by investing in and creating companies within Bloomberg’s broad areas of interest. Set up as a true fund, Bloomberg Beta will invest for financial return, selecting companies independently of their current or future business relationship with Bloomberg L.P, according to the press release.

 “Bloomberg Beta is a natural extension of the entrepreneurial spirit and culture of Bloomberg,” said Daniel Doctoroff, CEO and President of Bloomberg LP. “We’re guided by the belief that the best investors are entrepreneurs and the best entrepreneurs are investors. Through Beta, we get to back and build breakthrough companies in the areas we care about, and entrepreneurs get an investor whose interest is fully aligned with theirs.”

Bloomberg Beta’s partners say they will operate as a separate legal entity from their parent company, which is Bloomberg Beta’s sole investor. The firm will be based out of Bloomberg’s offices in San Francisco, where many of its technology reporters are also based. Bloomberg Beta’s initial focus areas are producing insights from data (data, technology platforms, content discovery, media distribution) and making the experience of work better (networks and communities, human-computer interaction, and radically new organizational models).

Roy Bahat, the head of Bloomberg Beta, said the firm will be set up as a separate legal entity.  Karin Klein in New York heads Bloomberg Beta’s investing activities on the East Coast. She is the former head of new initiatives at Bloomberg and previously was vice president at Softbank’s venture fund, according to the press release.
According to an official source, the company will follow the existing rules on conflicts of interest, which forbid the company to cover itself. In cases where reporters cover companies or investment firms in which Bloomberg has interests, investments will be disclosed in disclaimers.

By: Savita V Jayaram


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