Active Capital

Active Capital Research

Investment Thesis & Philosophy

Active Capital is a San Antonio-based venture capital firm founded in 2018 by Pat Matthews, an entrepreneur-turned-investor. The firm is purpose-built to lead concentrated pre-seed and seed rounds for B2B SaaS companies and enterprise software, specifically focused on supporting ambitious, technical founders across America. Pat Matthews' background as the founder of Webmail.us (acquired by Rackspace for $50M in 2007) and his 20+ years in enterprise software and cloud infrastructure inform the firm's deep conviction in backing founders who "would rather raise early capital from those who've walked in their shoes." Active Capital operates on the belief that great companies can be built anywhere and are not geographically constrained, actively investing across the country while maintaining deep roots in Texas.

Investment Focus & Sectors

Active Capital primarily invests in three interconnected sectors:

Enterprise Software & Cloud Infrastructure: The core focus includes DevOps, CI/CD platforms, observability and monitoring, database and data infrastructure, API platforms, and cloud infrastructure solutions. The firm sees clear opportunities in companies solving real enterprise problems with software and AI.

AI-Powered Business Software: Active Capital is increasingly focused on AI-native and AI-at-core companies. The firm recognizes that AI is creating a whole new category of vertical software/SaaS companies that can go much deeper than ever before. Examples include AI-powered developer tools, legal tech software powered by AI, and modern data infrastructure companies. The firm has invested in cutting-edge AI applications across multiple verticals.

Developer Tools & Infrastructure: The firm backs tools and infrastructure that enable developers and technical teams, including security tools, data infrastructure, and automation platforms. This sector aligns with their conviction that the next generation of great companies will be built on modern developer infrastructure.

Notably, Active Capital explicitly avoids consumer applications, non-technical founding teams, and companies outside their core thesis areas. They maintain disciplined sector focus despite broader market trends.

Stage Focus & Check Size

Active Capital is exclusively focused on pre-seed and seed-stage investing. The firm targets:

Pre-Seed: $250K-$500K for prototype development and proof of concept Seed: $500K-$1M typical check size, with ability to invest up to $1M-$3M for seed rounds

The firm's average check size ranges from $500K to $1M, with the ability to lead or co-lead rounds of $500K to $3M. As of 2025, their median check size is $500K-$750K. All LPs are "entrepreneurial" individuals or family offices, allowing the firm flexibility in capital deployment.

Critically, Active Capital maintains significant reserves for follow-on investments in successful portfolio companies. The firm explicitly avoids Series A and beyond, maintaining disciplined stage focus to remain genuinely pre-seed focused.

Lead Tendency & Decision Process

Active Capital demonstrates a clear preference to lead pre-seed and seed rounds. The firm states they "prefer to be a meaningful part of the first capital raised" and typically leads or co-leads rounds. They are equally comfortable with syndication and co-investment structures, enjoying partnerships with high-value-add and aligned investors. This balanced approach gives them flexibility in round structures and co-investor dynamics.

The decision process is led by Pat Matthews as Founder & CEO, with Cat Dizon as Co-Founder & Partner and Chris Saum as Investment Partner. These three core partners drive investment decisions. Decision timeline is estimated at 2-3 weeks, reflecting the firm's founder-friendly, streamlined approach. The firm explicitly welcomes warm introductions but also accepts cold emails from founders.

Recent Activity & Fund Status

Active Capital is actively deploying from Fund III, which closed in June 2025 at $28M+. This brings the firm's total assets under management to over $100M across three similarly-sized funds plus several SPVs.

Recent investment activity demonstrates consistent deployment:

• In 2025, the firm made 18 new pre-seed investments
• 14 of these 2025 investments were pre-revenue companies
• 10 were first-time relationships (cold inbound)
• 10 rounds were led by Active Capital
• 8 teams were based in SF, with half relocating post-investment
• 8 solo founders, some who added co-founders post-investment
• 6 came through cold inbound

As of January 2026, Pat Matthews posted that the firm had committed to funding four additional companies and began "wiring $100 million dollars" in capital, indicating robust deployment velocity despite macro headwinds.

The firm demonstrates a strong commitment to staying small and disciplined on fund size. Pat Matthews has publicly stated: "I believe in small funds. You can't really be a pre-seed focused investor if you raise bigger and bigger funds." This philosophy differentiates Active Capital from larger pre-seed vehicles.

Portfolio Highlights & Notable Companies

Active Capital has backed over 50 startups across the United States, with a track record of successful exits and high-performing portfolio companies.

Notable Exits & Acquisitions:

• ProsperOps (founder testimonial: "Active Capital was in our seed, and they are the most founder-centric VC we could have ever hoped to work with")
• SendSpark (founder testimonial: "Pat is the first person you want to share news with, good or bad. He's the perfect blend of coach, problem solver, cheerleader, and introduction machine")
• Cloudsnap (acquired by Paylocity)
• RemoteTeam (acquired by Gusto)
• VidGrid (acquired by Paylocity)
• Finmark (acquired by Bill.com)
• Favor (company that returned LPs to become active investors in subsequent funds)

Active Portfolio Companies: Teleport, Super Dispatch, ConductorOne, Schematic, Tryardent, Paradigm Robotics, FloatMe, and numerous others across enterprise software, developer tools, and AI domains.

Fund Performance: Active Capital's first fund has returned nearly 70% of capital deployed, with total value to paid-in capital approaching 4x—exceptional performance for a pre-seed focused vehicle.

Investment Team & Leadership

Pat Matthews, Founder & CEO: Entrepreneur and angel investor with 20+ years in enterprise software and cloud infrastructure. Founded Webmail.us in the 1990s, which Rackspace acquired for $50M in 2007. Post-acquisition, spent time scaling Rackspace and leading technology initiatives. Virginia Tech graduate ('02). Pat is based in San Antonio and is actively involved in sourcing, due diligence, and hands-on support for portfolio companies. He welcomes warm introductions and cold emails from founders.

Cat Dizon, Co-Founder & Partner: Works alongside Pat Matthews and co-leads investment decisions and founder support. Brings deep operational expertise and founder-friendly approach.

Chris Saum, Investment Partner: Brings investment expertise and supports the partnership. Based in Texas, actively involved in pre-seed sourcing and founder engagement.

Investment Advisors: The firm includes several experienced advisors including Chris Cochran (ProsperOps founder), Bethany Stachenfeld, Rick Barkley, Rami Essad, and Zac Mauris, who provide sector expertise and warm introductions.

Rackspace Advisors: Graham Weston (Co-Founder of Rackspace) and Pat Condon (Co-Founder of Rackspace) serve as advisors, providing deep enterprise software expertise and network access.

Geographic Focus

Active Capital is intentionally geography-agnostic in investment thesis but operationally rooted in Texas. The firm states: "At the end of the day, I care more about great founders than any one geography."

Primary Focus: United States with no geographic restrictions Secondary Emphasis: San Antonio, Texas (firm headquarters), Austin, and broader Texas tech community Growing Presence: Increasing time in San Francisco to access AI ecosystem and founders Notable Locations: The firm has portfolio companies in Austin, Kansas City, Atlanta, New York, San Francisco, and other US tech hubs

Engagement & Support Model

Active Capital takes a founder-centric, hands-on approach to portfolio company support:

1. Advisory Expertise: Pat Matthews brings 20+ years of enterprise software operating experience, providing strategic guidance on product development, go-to-market, and scaling
2. Network Leverage: Rackspace founder relationships (Graham Weston, Pat Condon) and broader enterprise software network provide introductions to customers, partners, and future investors
3. Tactical Support: The firm explicitly states they work to help founders "reach their potential" through regular engagement and problem-solving
4. Follow-On Reserves: Significant follow-on investment capacity allows the firm to provide multiple rounds of capital as portfolio companies achieve milestones
5. Founder Support: Founder testimonials emphasize Pat Matthews as a "coach, problem solver, cheerleader, and introduction machine"

Active Capital positions itself as more than a check-writer—they view themselves as operating partners and long-term supporters of founder success.

Founder Preferences

Active Capital seeks:

1. Technical Founders: All 2025 portfolio companies featured highly technical founding teams. The firm explicitly avoids non-technical founding teams.
2. Ambitious & Growth-Oriented: Founders who want to "reach their potential" and build large-scale companies, not lifestyle businesses
3. Problem-Solvers: Founders solving real, material business problems with software and increasingly with AI at the core
4. Bootstrap Mindset: Active Capital is seeing a resurgence in bootstrapped mindsets at pre-seed, with founders thoughtful about burn, business models, and path to profitability
5. US-Based: All portfolio companies are US-based or actively moving to the US
6. Solo or Small Teams: The 2025 vintage included 8 solo founders, many who added co-founders post-investment, demonstrating the firm's comfort with founder solo status at entry
7. First-Time Founders: The firm actively backs first-time founders (10 of 2025's 18 investments were first-time relationships from cold inbound)

Interestingly, Active Capital shows comfort backing pre-revenue companies (14 of 2025's 18 investments were pre-revenue) if the founders are exceptional and the problem is material.

Competitive Positioning

Active Capital differentiates through:

1. Solo GP Founder-Operator Model: Pat Matthews is actively sourcing and supporting companies, not delegated to investment teams
2. Founder Background: Pat's entrepreneurial background (successful $50M exit) allows him to genuinely "walk in the shoes" of founders
3. Discipline: Maintains small fund sizes and stays focused on pre-seed despite pressure to scale
4. Geographic Flexibility: Backs founders anywhere in the US while maintaining operational roots in Texas
5. High Returns: Fund I approaching 4x MOIC demonstrates exceptional pre-seed investing performance
6. Efficient Decision-Making: 2-3 week decision timeline and founder-friendly process (accepts cold emails)
7. Hands-On Support: Rackspace founder advisors, personal involvement from Pat, and meaningful follow-on capital
8. AI Focus: Early conviction on AI-native and AI-powered business software, positioning the firm at the forefront of the 2025+ trend

Fund Performance & Trajectory

Active Capital demonstrates strong institutional performance and growth:

• Fund I: Approaching 4x MOIC with nearly 70% of capital returned to LPs
• Fund II: Successfully deployed across 50+ companies
• Fund III: $28M+ closed June 2025, bringing total AUM to $100M+
• 2025 Deployment: 18 new investments, demonstrating continued strong capital deployment
• 2026 Outlook: Already committing capital in January 2026 at accelerated pace

The firm's ability to raise Fund III during a market downturn (US pre-seed funding down from $733M to $556M YoY) demonstrates strong LP conviction and track record.