“Excess capital covers up intellectual laziness,” he said. “The best, best companies never burned any capital, because they were rigorous about finding ways to make people pay for their product.”

Biederman, managing partner of Asymmetric Capital Partners, has a point. Consider, for example, Google—which raised a mere $25 million prior to its 2004 IPO—or Atlassian, which raised about $60 million in VC dollars before taking on the public markets. Still, these examples feel drawn from a time gone by, factual artifacts that feel roughly the way I do when I look at a rotary phone. Today, mega-AI rounds readily hit billions, and there’s a confusing but broad sense that more money flowing into a startup automatically guarantees long-term success. 

Biederman’s against-the-grain distaste for excess capital isn’t just intellectual or financial. 

“The emotional reason is that we want our founders to have tremendously good personal outcomes,” said Biederman, who previously spent eight years as CEO and cofounder of General Catalyst-backed Catalant. “VCs win when founders burn a lot of capital. Founders win when they don’t. So, it’s important to me that when our founders have successes, they go home with a life-changing result. And the more capital there is, the less likely there is to be a financially life-changing result.” 

Biederman is a reluctant VC, tacitly accepting the label with resigned self-awareness when I assign it to him. But all things being equal, he says, Asymmetric is “an early-stage technology-oriented investment firm, because I think [the industry] has lost the plot in some respects.” VCs, he told Fortune, are too tied up in asset-gathering over returns, tend to write off struggling startups too quickly, and just always get what drives customer value. Just because an idea is clever, doesn’t mean people need it.

“People who haven’t sold for a tech company sometimes get like ‘Oh, this entrepreneur is fantastic’ or ‘The ideas are smart,’” Biederman said. “No, people buy things that improve their lives.”

On its face, Biederman and Asymmetric’s story is very VC in certain ways. The firm was founded and raised its first fund in the 2021 boom, where a flood of emerging managers raised new funds and the IPO market was on a tear. 

The real test: whether these first funds could re-up with LPs, and raise second funds. The odds are tough in the best of times (statistically, the toughest leap for any new VC firm is going from fund one to fund two), and the 2021 vintage has had it rough. Per PitchBook, only about 8% of first VC funds from 2021 have raised larger second funds—and Asymmetric, based in New York and with a team of just five, is one of them. The firm has raised its $137 million second fund, passing its original $125 million target, Fortune has exclusively learned. 

Asymmetric has been writing checks between $2 million and $10 million for pre-seed through Series A startups in the vertical software and healthcare IT sector. The firm’s portfolio includes Torc, Counsel Health, and Eagle Electronics. The firm also backs rollups in scattered industries, like Cabana, which consolidates pool services businesses in San Diego. The first fund has already had three successful exits, all acquisitions—Torc, EvolutionIQ, and Zorus—and its assets under management now stand at $240 million.

“Look, we’re never going to have the largest funds, and we’re never going to have the highest AUM,” said Biederman. “Our only North Star is returns, and having the correct amount of money to produce the best returns. We had lots of people on this fundraise say ‘Hey, can you take a check for 50 to 75.’ And I was like: ‘I don’t think you understand, I can take, max, 20 or 25 of new capital.’”

The firm has kept its LP pool small, and it includes nine family offices that’ve known Biederman for more than a decade. LP Jim Millar, Yale lecturer and former managing director of Princeton University Investment Company, said his confidence in Asymmetric in part comes from how its deal flow works: “Asymmetric cultivates founder relationships one to two years before an initial investment, and 80-90% of their deal flow comes from referrals,” he wrote to Fortune.  

Biederman wants to keep it that way, and the primary path to that is empathy for the challenges of running a startup. 

“Being a founder is being in a dark room or being blindfolded in a room,” he said. “You know that there’s a fire in the room. You only have one bucket of water, and you have to throw the water onto the fire, not knowing where the fire is. You also know that if that bucket of water doesn’t put out the fire, you might not get another one.” 

See you Monday,

Allie Garfinkle
X: @agarfinks
Email: alexandra.garfinkle@fortune.com
Submit a deal for the Term Sheet newsletter here.

Joey Abrams curated the deals section of today’s newsletter. Subscribe here.

Venture Deals

- Veradermics, a New Haven, Conn.-based developer of an oral treatment for hair loss in men and women, raised $150 million in Series C funding. SR One led the round and was joined by Viking Global Investors, Marshall Wace, Invus, and others.

- Peptilogics, a Pittsburgh, Penn.-based developer of therapeutics designed to treat and prevent medical device infections, raised $78 million in Series B2 funding. Presight Capital, Thiel Bio, and Founders Fund led the round and were joined by AMR Action Fund, Narya Capital, and Beyond Ventures.

- Stand, a San Francisco-based insurance platform for properties exposed to catastrophes, raised $35 million in Series B funding. Eclipse led the round and was joined by existing investors Inspired Capital, Lowercarbon Capital, and Equal Ventures.

- ExaCare AI, a New York City-based AI-powered platform for post-acute and senior care teams, raised $30 million in Series A funding. Insight Partners led the round and was joined by Foundation Capital, Bienville Capital, and others. 

- Counsel Health, a New York City-based platform where patients can chat with a medical AI and then connect with a real doctor, raised $25 million in Series A funding. Andreessen Horowitz and GV led the round.

- Jack & Jill, a London, U.K.-based AI platform designed to find open jobs and help with applications, raised $20 million in seed funding from Creandum, Dig Ventures, Entrepreneur First, Ada Ventures, Firedrop, and others.

- UPCITI, a Paris, France-based developer of software and hardware for city operations, raised $20 million in Series A funding. Notion Capital led the round and was joined by Point Nine and Chalfen Ventures.

- Strella, a New York City-based AI-powered customer research platform, raised $14 million in Series A funding. Bessemer Venture Partners led the round and was joined by Decibel Partners, Bain Future Backed Ventures, MVP Ventures, and 645 Ventures.

- Armstrong, a San Francisco-based company developing robots for restaurant kitchens, raised $12 million in funding from Lerer Hippeau, Bloomberg Beta, Next Play Ventures, Transmedia Capital, and WestWave Capital.

- Bees & Beers, a Berlin, Germany-based platform designed to allow installation companies to offer installment plans, raised €5 million ($5.8 million) in seed funding from Extantia Capital and Contrarian Ventures.

- Karta, a Miami, Fla. and São Paolo, Brazil-based credit card company designed for non-U.S. residents with a U.S. bank account, raised $5.4 million in seed funding. Canary led the round and was joined by Clocktower Ventures and FJ Labs.

Exits

- Apax Partners agreed to acquire atHome, a Luxembourg-based real estate property platform, from Oakley Capital and Mayfair Equity Partners. Financial terms were not disclosed. 

Funds + Funds of Funds

- Ardian, a Paris, France-based private equity firm, raised $20 billion across multiple funds focused on energy, transport, and digital infrastructure companies in Europe.

People

- ArcLight Capital Partners, a Boston, Mass.-based infrastructure investor, hired Sara Graziano as a partner. Formerly, she was with SER Capital Partners. 

Other

- Buildots acquired Genda, an Austin, Texas-based workforce and safety management platform. Financial terms were not disclosed.