Ben Nye’s new VC firm won’t just give you a fish, but will guide you to the best lake

For the past 19 years, Ben Nye sought out promising infrastructure software as co-managing partner of Bain Capital Ventures. Now he and a group of four partners, collected from his time at Bain and as CEO of Turbonomic, are doing the same thing but out on their own with Venture Guides.

Nye said the firm’s name was a nod to his fly-fishing days after college when he would be a guide for people salmon fishing in Alaska.

“The reason that you hire a guide is you get a better experience and more yield,” he told TechCrunch. “We're not going to give you a fish, but we will teach you, show you and help you, and that's the idea.”

The team comes with quite a successful track record: Nye's team's early-stage track record returned 7.9 times to BCV investors, while eight of 21 investments reached unicorn status, including Turbonomic, which the team led to a $2 billion sale to IBM in 2021.

Venture Guides recently closed on $215 million in capital commitments for seed and Series A infrastructure software companies. Nine weeks after securing ELJ Ventures as its anchor investor in November, the fund became oversubscribed when ELJ Ventures increased its initial commitment 80%, amid a family office and four other groups doing so as well.

Nye spoke with TechCrunch to discuss, among other things, the fund, the fundraising environment and what excites him about infrastructure software. The following has been lightly edited for clarity and length.

Ben Nye, founder of Venture Guides (Image credit: Venture Guides)

TechCrunch: After being part of Bain, what was it like to go out on your own and start a new fund?

Ben Nye: It's actually been a really steep learning curve, in some respects. In other ways, it's exactly the same as it always was. What we say when we've been out in the market is, ‘we're a new firm, but we're not a new manager.’ With Bain, we had an IR department that was rather large, and all of a sudden, we had no IR department, so in that sense, it’s much more like a startup.

What did you learn as you went out to raise for the fund?

The original thought was to talk to the traditional endowments and foundations, but they've had a rather rough go of it between two things: the enormous amount of capital drawn from the damaged foundations at a pace that took some folks down to like single-year vintages, which is really a fast pace of investing. Second, when the market started to turn and the cost of capital rose instead of 35 years of declining, you saw the public markets compressed.

With that dislocated market, we had to think about the markets differently and about who is going to make rational investor decisions. It’s not an allocation, it's an investment decision. ELJ Ventures, who's our family investment office and their family out of the Dominican Republic, is a really strong investor, and they've been in some Bain Capital spinout companies. They were ones that helped get a whole bunch of family offices behind them. We were then able to get over 30 firms, a large group of founders and a larger group of partners from the executive C-suite. It's a very interesting group of people who can appreciate why our message is going to be such a good method.

Was this fundraising environment unique or have you encountered it before?

I spent five years as a political appointee in the U.S. Treasury and that gave me a lot of exposure to the importance of having an opinion about where interest rates are headed, and what the macro impact is on your investing climate. Today, when you look at inflation, it's obviously moderated. And if you look at the pricing environment, it's a little more realistic in terms of the private markets as well as in the public markets because the public market led the way. It's setting up to be a very, very strong vintage, if you know what you're doing.