The New World of VC and Building a Durable Firm with Category Ventures' Villi Iltchev

Follow me @samirkaji for my thoughts on the venture market, with a focus on the continued evolution of the VC landscape.

Welcome to another episode of Venture Unlocked. In this episode, I had the pleasure of welcoming Villi Iltchev, founder and managing partner of Category Ventures. Villi has had a long history in tech, both in operating roles at companies like Box and Lifelock, as well as investing roles at August Capital and Two Sigma, where he departed in 2024 to launch Category Ventures.

We covered a lot of ground in our conversation, including his inspiration for starting a new firm and the experiences that informed his true north. We also spoke about the fragmentation of the market and what it means to win in early-stage investing in a heavily crowded market of dedicated seed funds & larger funds who are active in see and Series A. I really enjoyed the authenticity of the conversation and hope you do as well.

About Villi Iltchev

Villi Iltchev is the Founder and Managing Partner of Category Ventures, an early-stage venture firm focused on backing category-defining enterprise software companies. With over two decades of experience as both an operator and investor, Villi has held leadership roles at Box, LifeLock, and Salesforce, where he led investments and acquisitions in companies like HubSpot, MuleSoft, Gusto, and Zapier. As a General Partner at August Capital and later at Two Sigma Ventures, he backed standout startups like GitLab—turning a $20M investment into over $900M in returns. Originally from Bulgaria, Villi brings a global perspective and a founder-first mindset to every partnership.

Category Ventures is an early-stage venture firm founded in 2024 by veteran investor Villi Iltchev, focused on backing category-defining enterprise software startups. With a $160M debut fund, the firm invests in pre-seed and seed-stage companies across infrastructure, dev tools, AI, and applications. Drawing on Iltchev’s track record—including early investments in GitLab, Zapier, and Gusto—Category Ventures brings deep technical and go-to-market expertise to help founders build enduring businesses. Their approach centers on hands-on support and founder-first partnership to shape the future of enterprise software.

In this episode, we discuss:

* Villi’s Background and Journey (1:50)

* Lessons from Venture Capital Firms (5:35)

* Market Fragmentation in Venture Capital (8:47)

* Flexible Investment Strategy (12:24)

* Challenges with Traditional VC Models (13:26)

* Product Market Fit and Founder Support (17:35)

* Counterpoints on Large VC Firms (21:40)

* Winning in Venture Capital (24:07)

* Kindness and Community (26:24)

* Components of Success (30:00)

* Decision-Making Process (33:21)

* Intellectual Honesty in Investments (36:16)

* The Role of Fresh Perspectives (40:08)

* Acting on Great Ideas and Final Thoughts (42:27)

I’d love to know what you took away from this conversation with Villi. Follow me @SamirKaji and give me your insights and questions with the hashtag #ventureunlocked. If you’d like to be considered as a guest or have someone you’d like to hear from (GP or LP), drop me a direct message on X.