Drive Capital’s Second Act: Success After a Split
After its co-founders parted ways, Drive Capital, a Columbus-based venture firm, struck back with renewed strength. Now, they helm a top-performing VC that thrives beyond Silicon Valley. Moreover, the split has not slowed their momentum it’s sharpened their focus and results.
The Split That Shaped Them
Three years ago, co-founders Chris Olsen and Mark Kvamme both former Sequoia partners then went their separate ways. Meanwhile, Kvamme launched the Ohio Fund, focusing on local infrastructure and real estate. On the other hand, Olsen stayed behind and subsequently steered Drive Capital back on course, driving a strong rebound
Fast $500M Return
In May, Drive Capital surprised investors by returning $500 million in just one week after cashing out of Root Insurance and Thoughtful Automation. As a result, limited partners welcomed this rare injection of liquidity amid today’s tight venture market. Moreover, this move underscored Drive’s strength and strategic agility in a landscape where such quick returns remain uncommon
Strategic Contrarian Approach
Rather than chasing rare unicorns, Olsen deliberately targeted $3 billion‑plus exits, which he considers both common and repeatable. Meanwhile, Drive Capital typically secures around 30% ownership per round a stark contrast to Silicon Valley’s usual 10% approach. As a result, the firm builds deeper positions in its portfolio companies, boosting both control and potential returns
Underserved Region Focus
Moreover, Drive Capital invests in overlooked markets such as Columbus, Austin, Boulder, Chicago, Atlanta, and Toronto. In addition, they channel capital into tech applied to traditional industries for example, autonomous welding and next‑generation dental insurance that often go unnoticed by coastal VCs. As a result, Drive builds a differentiated portfolio that taps into America’s broader economic base beamstart.com
Track Record: Hits and Misses
They backed Duolingo early on now valued at $18B+ and Vast Data valued at $9B . But they also experienced setbacks like Olive AI, once valued at $4B, which later struggled .
Overcoming Early Challenges
Starting a venture firm is never easy, and Drive Capital faced its share of hurdles early on. Internal disagreements led to a significant split. This separation forced the remaining team to re-evaluate their strategy and rebuild their firm’s identity. They doubled down on their core beliefs and sought opportunities that others missed.
A Unique Investment Strategy
Drive Capital distinguished itself by focusing on investments outside of the traditional tech hubs. They believed that innovation existed everywhere, not just in Silicon Valley or New York. This contrarian approach allowed them to identify and support promising startups in often-overlooked regions of the US, focusing on the Midwest. Their investment thesis centered around backing companies building real-world solutions, as opposed to chasing fleeting trends.
Key Investments and Portfolio Growth
Drive Capital’s portfolio includes companies across various sectors, demonstrating their versatile investment strategy. Through strategic investments and active involvement, they’ve helped these companies scale and achieve significant milestones. Some of their notable investments include companies in sectors like:
- Healthcare technology
- Logistics and supply chain
- Enterprise software
By providing not just capital, but also operational expertise and network access, Drive Capital has been instrumental in the growth of its portfolio companies.
Building a Strong Team and Culture
The success of Drive Capital is attributed not only to their investment strategy but also to the strong team they built. They fostered a culture of collaboration, innovation, and relentless focus on results. They prioritize transparent communication and empower their team members to take ownership.
Looking Ahead
As Drive Capital looks to the future, they remain committed to their original vision: supporting innovative companies outside of traditional tech hubs. They plan to expand their investment reach and continue building a portfolio of high-growth companies. With a proven track record and a clear strategy, Drive Capital is well-positioned for continued success in the venture capital industry.