Designer Fund Closes On $40M Fund 3 To Invest In Design-Led Companies

San Francisco-based Designer Fund, founded by Ben Blumenrose and Enrique Allen, has closed on Fund 3 at $40 million to invest in seed-stage companies.

We spoke with Blumenrose on the latest fund and his 20 years as a designer.

“It’s very important that we work at the early stage of company building, and we are very collaborative with other co-investors,” said Blumenrose.

Designer Fund partners with a startup on design thinking. The firm typically invests the second-largest check in a seed round, around $500,000, and tends not to lead. It is selective and plans to invest in around 30 to 35 companies with the new fund, or around eight investments a year, which allows the firm time to spend with each company.

Blumenrose’s defining design experience was at Facebook (now Meta), which he joined in 2007 when the company was three years old and left just before the IPO in 2012.

In 2011, as Facebook was becoming successful—that was the year that DST Global and  Goldman Sachs invested $1.5 billion at a $50 billion valuation—Blumenrose began to receive calls from founders, investors and engineers wanting help with their startups.

At Facebook, design and engineering worked together but Blumenrose said he found that “design was non-existent in the venture ecosystem, especially at the early stage.”

As the nights and weekends on this side project became demanding, Blumenrose realized with (Enrique) Allen that they should focus on their own venture full time. The co-founders raised the first fund in 2014 and the second fund in 2019.

Early investments

Omada Health, Gusto and Stripe were early Designer Fund investments.

“Any time you hear someone say it was really easy to use, whether or not they use the d-word, that’s design, right?” said Blumenrose about Stripe. “Stripe also thought about interaction, design, and UI design, and since day one they had designers that were just sweating the details.”

Payroll management firm Gusto has brought a consumer-level experience to an enterprise company, said Blumenrose.

“There’s a literal humanness in the product,” which is unexpected for an enterprise company, he said.

Designer Fund is tapped into the design community where thousands of designers participate in its community events and workshops.

Once a startup hires its first designer, “we act as a partner for the design team to help them think about how to scale design, how to partner with engineering and how to overcome any performance challenges to make sure that you’re getting the most out of your design team.”

The firm also provides design advice to its portfolio companies.

Said Blumenrose, “We have hundreds of design leaders from all over the tech community who are ready and willing to give design advice to the companies that we work with.”

Crunchbase Pro queries in this article

Illustration: Dom Guzman