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Why are the San Francisco 49ers owners raising $50M from investors?

San Francisco 49ers CEO Jed York | Source: Tony Avelar/AP

The owners of the San Francisco 49ers football team are raising $50 million from investors for a new venture capital fund known as Aurum Fund I, according to a Form D filing with the Securities and Exchange Commission. 

Aurum Partners, a family office tied to the York family, is seeking outside investment for the first time to expand its startup investment activities. The filing lists the Menlo Park headquarters of Aurum Partners as the central business location for the VC fund. 

The filing said that no investors have signed on as of Aug. 18, but Aurum Partners plan to close investment in the fund in less than a year. Aurum Partners did not respond to a request for comment by publication time.

The two executive officers for the fund listed in the filing are Jed York, the current CEO of the 49ers, and Brano Perkovich, the current chief investment officer for the 49ers.

Both York and Perkovich also serve as the general managing partners for Aurum Partners LLC, which has made a number of previous startup investments in companies like sports gambling site FanDuel, fertility benefits startup Carrot and human resources software company Gusto. 

The efforts to spin up a new venture capital fund come as York faces an insider trading lawsuit filed by shareholders of online education company Chegg against the company’s executives and board members. York has served as a board director of Chegg since 2013.

A series of shareholder lawsuits, which were consolidated earlier this year in the U.S. District Court of Northern California, allege York and other company leaders of selling shares in Chegg at inflated prices while concealing the company’s role in helping students cheat on online tests and the way that the pandemic temporarily surged interest in its services to unsustainable levels. 

According to the lawsuit, York sold 20,000 shares “at artificially inflated prices,” earning some $1.4 million in profit. The plaintiffs are seeking financial restitution, legal fees and reforms to Chegg’s corporate governance, including the ability for shareholders to appoint at least five board candidates. 

"Chegg is actively and resolutely defending against these baseless claims in official court filings," a company spokesperson said.

During a preseason media availability for the 49ers, York answered questions about his Chegg’s legal challenges for the first time publicly.

In an interview with NBC Sports Bay Area and the San Jose Mercury News, York characterized the lawsuit as “completely frivolous.” 

“I think they’re grasping at straws to bring this out publicly now,” he told the news organizations. “I have no doubt this will be taken care of in no time.”

York was elevated to the role of 49ers team president in 2008, taking over daily management of the team from his parents. York’s family has controlled the 49ers since 1977, when his grandfather Edward J. DeBartolo Sr. purchased the team for roughly $65 million in today’s money. Last season, Forbes valued the team at $5.2 billion.

Kevin Truong can be reached at kevin@sfstandard.com