Betaworks’ third fund closes at $66M to spend money on early-stage AI startups

New York Metropolis-based Betaworks has closed its $66 million Fund III, which is able to deal with investing in early-stage AI firms. 

Betaworks has been investing in AI since a minimum of 2016 and, via its funding program Camp, has backed firms reminiscent of Huggingface and Granola. Jordan Criminal, a associate on the agency (and former TechCrunch worker), mentioned the brand new fund will deal with brokers, native AI interfaces, and application-layer AI. 

“Round these themes, we’ll proceed to do straight seed investing and the Betaworks Camps,” Criminal mentioned. 

Fund III will search to spend money on a minimum of 25 pre-seed to seed investments, in addition to make a minimum of 50 investments into startups as a part of the Betaworks Camp program. “To date, we’ve performed round 37 offers,” Criminal mentioned, including that the common test measurement was round $500,000. 

Criminal known as the present fundraising atmosphere “frothy” for startups, and “spiky” for funds, however she famous that Fund III noticed lots of the agency’s earlier restricted companions returning to take a position. 

“The fundraising atmosphere in enterprise was difficult in 2024, and we weren’t exempt, on condition that we had been upsizing our fund,” she mentioned.

Betaworks beforehand raised a $46 million Fund II in 2020, and a $48 million Fund I in 2016. It launched in 2008 as a enterprise studio, and has since turn into a staple within the New York Metropolis tech ecosystem, launching its Betaworks Camp program in 2016. The agency’s different notable investments embody Tumblr and Kickstarter.