Max Altman raises $125 million for seed-stage enterprise capital firm Saga Ventures

Investors Thomson Nguyen and Ben Braverman were in discussions with major enterprise capital firms about possible roles last September once they met in San Francisco to debate another choice: a collaboration with Max Altman.

Max, the younger brother of Sam Altman (CEO of OpenAI) and Jack Altman (former CEO of Lattice), had spent almost a decade investing alongside them through the Hydrazine Capital, Apollo Projects and Altman Capital funds. But he had left San Francisco for Austin, Texas, partly to get some respiration room from the family name, and now he desired to develop himself further with a brand new company.

Braverman, the previous chief revenue officer at logistics unicorn Flexport, and Nguyen, an entrepreneur who recently sold his second startup, had each made smaller investments through Flexport and the Y Combinator network. With Altman, they might turn out to be co-founders while improving their deals and check sizes.

The result’s Saga Ventures, a $125 million fund focused on early-stage software startups and led by Altman, Braverman and Nguyen as general partners. Saga plans to make use of the fund to take a position about $2 million to $2.5 million in 30 corporations, its partners said ForbesLead or co-lead early-stage rounds.

Saga’s strategy is just not to reinvent the wheel: the partners plan to take a position in classic software-as-a-service startups in categories similar to work software and fintech, constructing on combined previous investments similar to manufacturing startup Hadrian, the financial software manufacturer Ramp and Space. resident drug developer Varda. Not surprisingly, AI is one other area of ​​interest. But Saga hopes to approach the endeavor a bit in a different way, by specializing in applications for people outside of the tech space. “Today’s low-hanging fruit is taking technology, which today is AI, and applying it to really hard problems that will affect every American,” Altman said Forbes. “You have to build a tool that someone in Houston or Minneapolis can use.”

After interning as a Duke student with former Midas List investor Steve Anderson, Altman was hired as one among the primary product managers at Zenefits. During his time on the human resources software startup, Altman was known for arguing that tech corporations shouldn’t construct products only for other tech corporations, said former CEO Parker Conrad. “He has always pushed the position that needs to be built for companies across the country,” Conrad said.

But that approach fell into the background for a time at Hydrazine Capital, where Altman helped his older brother Sam manage his expanding enterprise fund. They backed quite a lot of early Y Combinator corporations, including the social media site Reddit and the intelligent email service Superhuman, in addition to Conrad’s next company, Rippling, where Max Altman briefly took a job. (These resources are a giant reason why Forbes called Sam Altman a billionaire earlier this 12 months.)

As the elder Altman spent more time with OpenAI, Max Altman increasingly handled day-to-day operations, an arrangement they continued with Apollo Projects, one other family affair that included Jack Altman. Apollo Projects should concentrate on moon imaging and deep-tech betting, they said Forbes in 2020. But the corporate soon expanded into more traditional software ventures, partly as a consequence of the high costs and long duration of such ventures.

With OpenAI’s growth pushing Sam Altman to maintain minimal involvement, Jack Altman and Max Altman next founded Altman Capital, a leveraged fund that was often confused with a family office. Ultimately, being brothers full-time turned out to be more burden than fun. During a recent visit to their mother for Passover, Jack and Max Altman were discussing the opportunity of investing together when Jack declared the subject off-limits during family time. “We kept our mouths shut for 24 hours about a very recent deal,” Max Altman said. “That’s just not a great way to live your life.”

Altman’s alternative path began in 2021, when he lived in a pandemic “bubble” house in New York with a couple of other people from the tech industry, including Braverman. The two became friends when Braverman, Flexport’s former CRO, saw his role shift to deploying tens of thousands and thousands of capital in strategic investments for the corporate to advance its ventures. At a separate tech conference in Hawaii, Altman befriended Nguyen, who sold fintech startup Nearside to Plastiq in 2022 and has been a prolific angel investor throughout the Y Combinator community. (Nguyen’s previous startup, Framed Data, went through YC the identical 12 months as Flexport in 2014, before being acquired by Square.)

When the chance to work together as a trio arose, the three investors decided that they had the mandatory rapport and complementary skills and networks for an enduring fund. (Nguyen plans to remain in San Francisco, Altman in Austin and Braverman in New York.) After spending the autumn discussing their options – The Information previously reported Through these discussions, they concluded that a comparatively smaller fund with a concentrated investment portfolio would offer the most effective likelihood of success.

Their different strengths have already proven helpful at several startups backed by two or more partners, the CEOs of those corporations said. At business-to-business payments startup Slope, CEO Lawrence Murata, a Forbes 30 Under 30 List alum alongside co-founder Alice Deng said he relied on Nguyen early on due to his experience in fintech, similar to establishing enterprise models; Altman, an investor alongside his brothers, helped with high-value client and investor calls. Murata now also emails Braverman about go-to-market strategy and hiring. “We are pleased about the collaboration,” said Murata. “We’re already sending them other startups.”

Transport payments startup AtoB has previously made separate investments from all three of Saga’s partners; CEO Vignan Velivela told an analogous story: Nguyen helped with fintech expertise, Altman helped along with his connections, and Braverman helped arrange sales. “They really care and that really stands out,” Velivela said.

As for whether Saga can differentiate itself from other seed funds, established investors who’ve worked with the young company’s partners said they appear forward to working with Saga. At Khosla Ventures, partner Keith Rabois said he once tried to rent Altman and believed his grasp of business fundamentals and lack of interest in tech industry hype would serve the corporate well. At Founders Fund, partner Trae Stephens, a Flexport investor, said Braverman has been a giant a part of the corporate’s personality and has now given his company one other trusted in-network funding source for startup deal flow. And at Kleiner Perkins, partner Ilya Fushman, who previously invested in Nguyen’s startup, said his experience founding and selling two startups is rare amongst enterprise capitalists. “All three encompass many different areas,” Fushman said.

Of course, much of what Saga Ventures does won’t be that different from many other seed enterprise funds. “Max will do some of the same things as everyone else,” Sam Altman said Forbes. “But he will also work on these companies that target every American, building for and in places that Silicon Valley often overlooks.”

For each of Saga Ventures’ general partners, the chance represents a step toward greater rewards and risks. “Rationally speaking, we’re moving up to the big leagues,” Braverman said. “You have to really like the people you’re starting something with,” Nguyen added.

Altman, meanwhile, is desirous to prove himself with select non-blood partners, with the added motivation of now competing, at the very least partly, along with his siblings for the most effective startup investment returns. “There is nothing that drives me more than proving that the three of us can do this together,” he said.