Mr. Ehrenberg

IA Ventures, the New York City-based firm with a big data fetish, just announced that it raised $105 million towards a second fund. That's more than double the $50 million seed fund IA Ventures founder Roger Ehrenberg raises in 2010.

With this new fund, Mr. Ehrenberg told TechCrunch, IA Ventures will be able lead seed rounds as well as series A and B rounds and follow a company through its growth. Previously, IA gravitated towards pre-revenue companies “between a Powerpoint and a prototype.” Those companies, says TechCrunch, require more "hands-on work," and with Fund II, IA Ventures will be able to diversify its portfolio into both seed-stage and later-stage companies.

TechCrunch's post on the new fund set off a chain of negative responses on Twitter, unrelated to IA Ventures, but rather to do with a theory Erick Schonfeld slipped into the piece about the difference between East Coast and West Coast investors below.

In fact, there seems to be a divide between East Coast and West Coast superangels. “There is a huge ideological argument right now at play,” says Ehrenberg. Investors like Ron Conway, Dave McClure, and even Clavier make a lot of small bets—60, 100, or more per fund—hoping a few of them will pay off massively. They know that somewhere in their portfolios could be the next Google or Facebook. The East Coast seed investors are a little bit more cautious (they would say “disciplined”). Ehrenberg models IA Ventures more like a small Union Square Ventures or Foundry Capital—a more concentrated portfolio where the investors use their contacts or domain expertise to help take some of the risk out of the companies.

“The optimal point on the risk-return frontier,” says Ehrenberg, “is putting small amounts early, being close, and being in a position to put in more money when there is an opportunity to de-risk as opposed to holding a portfolio of lottery tickets and hoping that one of those lottery tickets looks like Google or Facebook.”

The idea that East Coast investors were risk-averse in particular, did not sit well with some, including Mr. Ehrenberg and IA Ventures's Ben Siscovick:

The contradiction Mr. Dixon seems to be getting at is the idea that small, pre-revenue investments supported by a hands-on approach are at odds with the idea of getting in on the ground floor with the next Google when it still looks like a long shot.

Reached by email, Mr. Dixon said, "Just look at the investments by Betaworks, Founder Collective, Highline, Thrive, Lerer, etc. Some examples companies: Tumblr, Tweetdeck, Pinterest, Uber, Fab, Artsy, Birchbox, Warby Parker, Makerbot, Buzzfeed, etc. It is a long list of great tech companies. In almost all cases these firms invested in the first financing round."

Sorry, Schonfeld, Conway vs. Ehrenberg is no Biggie vs. Tupac.

Sisco kid

Roger Ehrenberg started with a career on Wall Street, but he's become one of the most respected and sought-after investors in the New York tech scene. He is the founder of IA Ventures, which recently raised a $50 million fund and invests "on the belief that managing and extracting value from massive, occasionally unstructured, often real-time data sets is a competitive advantage."

Ben Siscovick, a member of the investment team at IA, gave a talk at General Assembly this week to a packed house on the topic of big data. He was nice enough to throw the video up on his Tumblr, so for everyone who was stuck in the office and missed out, let Betabeat drop a little knowledge on ya.

IA Ventures - The Business of Big Data at General Assembly 7/12 Part 1 of 2 from IA Ventures on Vimeo.

Check out the rest of the session over at Mr. Siscovick's blog.