Printer giant Xerox has sunsetted Xerox Ventures, its corporate VC arm, in favor of anchoring a debut AI-focused fund from Myriad Venture Partners, a new firm spun out by former Xerox chief strategy officer Chris Fisher.
Fisher, who also founded Xerox Ventures, has hired away two others to Myriad with the company’s blessing. The fund held a $100 million first close, and is targeting a $200 million final close.
Myriad will assume Xerox Ventures’ current portfolio and invest across AI, cleantech and B2B software. It will write seed checks between $500,000 and $2.5 million and Series A checks in the range of $6 to $7.5 million.
As an independent firm, Myriad will have more discretion over its investments, which may not be of strategic interest to Xerox. The move also frees it from the perception that its ties to a corporate mother ship risk conflicts of interest.
“That’s why you often see CVCs always have board observer seats and almost never have actual board seats,” said Fisher, who now serves as Myriad’s managing partner.
Some founders are reluctant for a corporate venture capital group to act as the sole lead investor on a funding round, out of concern that it would dissuade other corporates from pursuing an acquisition.
On the other hand, CVCs have been largely insulated from the LP pullback from venture because of their funding structure. In 2023, CVCs participated in a larger share of deals by total value than in any year since at least 2013, according to the latest PitchBook-NVCA Venture Monitor.
Xerox Ventures was also a financial-first CVC, rather than strategically motivated. Nevertheless, at Myriad, Fisher has more autonomy.
“One of the benefits of being an institutional fund and a fund of this size is the ability to lead direct investments, to write term sheets, sit directly on the board … and also larger check sizes.” he said.
Those larger investments will be much needed for Myriad’s focus on enterprise AI software. Generative AI companies have been the outlier in the depressed VC funding environment: Despite the headwinds, many of these startups were able to achieve substantial valuation jumps in 2023. One such company in Xerox’s—and now Myriad’s—venture portfolio is Seurat Technologies, a next-generation chips manufacturer for the industrial sector, which raised a $99 million round in October.
Indeed, 44% of new US unicorns last year were AI or machine learning companies. The fanfare is familiar to those who invested in startups in the 2021 bull market, but many investors argue that the transformative nature of this industry will moderate a future bubble burst.
“I think we’re only at the beginning [of the curve],” Fisher said. “I think it’ll keep going.”
Featured image by James Leynse/Getty Images
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