Sarah Smith Launches $16M Fund, Envisions AI Revolutionizing Opportunities for Solo GPs

On Thursday, Sarah Smith, founder and managing partner of the Sarah Smith Fund, announced the successful closure of a $16 million Fund I.

Smith launched her fund in 2022 after spending seven years as an investor at Bain Capital Ventures and now operates as a solo General Partner. She expressed her amazement at the potential of AI for firms like hers, particularly those that are solo or next-generation. “I can’t imagine approaching venture capital any other way now,” she shared. “While creating a company requires collaboration, I believe that early-stage investing is most productive when conducted independently.”

She appreciates the rapid decision-making capabilities she possesses without needing to seek committee approval. Furthermore, she has integrated AI as an essential tool on her journey.

“Every day, I think of new ways to assist my founders by leveraging my expertise and network in conjunction with AI,” she noted.

“For example, just last week I led a values articulation project for one of my founders,” Smith explained. “This task took me two to three hours, whereas it would have previously required 20. With an AI-enhanced firm that can deliver 10x value in just a fraction of the time, scaling a large portfolio becomes achievable for a single individual.”

Previously, she managed a rolling fund of $3 million and dedicated a year to raising capital for Fund I. The goal of Fund I is to invest in 50 companies, and it has already supported 17, with an average investment of $250,000. The fund’s limited partners include Pear VC, Ulu Ventures, and Verdis Investment Management.

Fund I mainly focuses on startups within the Stanford ecosystem, leveraging Smith’s connections as a university alumna. She also cites research to back her emphasis.

“Stanford has generated more unicorns and overall exit value than any other university worldwide,” she stated, referencing research by Ilya Strebulaev which shows that 11% of unicorn founders are affiliated with Stanford. “While many established Sand Hill firms dedicate their resources to San Francisco, 45 minutes north, I am amplifying my efforts on the Stanford campus.”