San Francisco-based venture capital firm GFR Fund has raised a total $53.5 million towards its third tech fund, with this iteration (Fund III) set to support entertainment, consumer technology and gaming.
GFR Fund is known for investing in early-stage companies and particularly focuses on pre-seed investments, empowering concepts to hit the ground running.
Fund III: new and improved
Fund III is expected to invest roughly a third of the $53.5 million into gaming content and technology. A portion of the remaining funds will go towards generative AI companies also, which will likely have a knock-on effect for game development given the tool’s rise to prominence in 2023.
Another 30% of Fund III is to be committed to follow-on investments in companies GFR Fund has previously supported. The first fund was formed back in 2016 and raised $18 million, going on to invest in 23 companies.
Then the GFR Fund II kicked off in 2019, supporting augmented reality and virtual reality companies, esports, blockchain and more with $20 million raised.
The new $53.5 million fund is a huge upgrade in scale, therefore, with more money than the first two funds combined being set aside for promising startups.
General partners Teppei Tsutsui and Yasushi Komori bring a background in finance and the games industry respectively, meaning GFR has a wealth of contacts from across the sectors; the firm frequently provides startups with hands-on support, networking and connecting aspiring teams with top-level talent.
"With Fund III, we’re tripling down on our sweet spot: the future of gaming and entertainment," said Tsutsui. "We believe that first-time founders with an emerging digital native communities mindset are the best-positioned to build the next generation of gaming and entertainment companies."
GFR Fund is backed by big gaming names including Square Enix, Bandai Namco and DeNA. The latter officially established a joint venture with Nintendo this year to research and develop digital services.