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Metalab went from quietly building the Internet to investing in the Internet

After nearly 20 years of success in helping startups develop products, Canadian interface design company Metalab has established Metalab Ventures to invest in many product-led startups.

Serial entrepreneur and investor Andrew Wilkinson founded Metalab in 2006, and the company has been supporting product innovation for companies like Slack, Coinbase, Uber, and Tumblr.

Metalab often works with startups, sort of like a co-founder, to help them launch their products. Then, “let them run free,” Metalab CEO Luke Des Cotes told TechCrunch. Metalab had a record year in 2023, co-developing 40 products that were launched last year.

Corporate venture capital has come a long way over the past few years. For example, as a stable source of funding or when a startup has something that a big tech company wants.

Des Cotes said that through Metalab Ventures, the venture capital arm will act as a long-term value investor, essentially “putting your money where your mouth is.”

“We hope to be on the journey with them over the next 10 to 12 years,” he said. “Founders asked us over and over again when we were going to invest, and sometimes we did, but it used to be ad hoc. Today we make it a formal process.”

Metalab Ventures has raised $15 million in capital commitments for its first fund, investing in product-led startups where strategy, design and technology are key differentiators.

Des Cotes said being “product-led” means the product will be the differentiating factor for the business. Some of the main factors in the success of most businesses depend on how well the product is created and how well it connects with its users. Metalab Ventures is looking for founders who “believe in design as a tool to connect with users in different and special ways,” he said.

Des Cotes and Metalab head of partnerships David Tapp are general partners at Metalab Ventures and will invest in 25 to 35 startups at the pre-seed, seed and Series A stages. DeCortes said the company has made some unannounced investments so far.

The new fund’s limited partner makeup includes institutions, fund-to-funds, angel investors and founders of companies with which Metalabs has previously worked. Metalabs is also a limited partner in the fund.

Des Cotes said the company conducts due diligence on thousands of founders each year to determine who it will help, and the same process has moved to how Metalab Ventures evaluates investments.

When identifying people to invest in Metalab Ventures, the process includes getting to know the founders and whether the company can add value. Metalab regularly leverages its 160 employees to provide design, technology, product and research leadership.

“We already operate very much like a venture fund,” DeCortez said. “Now we are going through this process to understand what is the product, what is the opportunity, what is the value that can be created here. When we believe in this business, we view human capital as our scarce resource, and then we can deployed into these businesses.”

Any interesting tips or clues about what’s going on in the venture capital world? Send tips to Christine Hall at chall.techcrunch@gmail.com or through this Signal link. Requests for anonymity will be honored.

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