Benchmark Capital raises $2 billion, breaking its fund size tradition

Benchmark Capital, the Silicon Valley venture capital firm, is breaking with its two-decade tradition of capping its funds at about $425 million. The firm has raised $2 billion in total capital across two new investment vehicles:

• A $1.25 billion growth fund, marking the firm’s first dedicated vehicle for later-stage investments.
• A $750 million early-stage fund, which provides more flexibility to write checks as early-stage valuations rise.

Historically, Benchmark maintained its small fund sizes to maximize returns, typically targeting a 20% stake in each startup. However, these small vehicles likely prevented the firm from investing in capital-intensive AI startups, such as foundation model developers. The new capital structure allows the firm to back companies across more stages. Everett Randle, a general partner—a term the firm uses for its senior investment professionals—noted that Benchmark seeks to build a “meaningful and deep relationship with the entrepreneurs, and that can happen relatively early in the company’s lifecycle, at seed, [Series] A, at [Series] B.” The firm previously tested later-stage investing by raising a $225 million special purpose vehicle (SPV)—a single-deal investment vehicle—to participate in a $1 billion pre-IPO round for chipmaker Cerebras. Benchmark first led Cerebras’s Series A in 2016, and the chipmaker’s recent IPO returned $3.25 billion to the firm at the IPO price.

Benchmark’s AI portfolio includes Singapore-based AI agent platform Manus. Last year, Benchmark led a $75 million round in Manus, which reached $100 million in annual recurring revenue within eight months of launching. Meta later agreed to acquire Manus for roughly $2 billion. However, Chinese regulators — arguing the company, which was founded in China before relocating to Singapore, had violated export control laws — blocked the deal in April.

The strategic pivot coincides with a significant shift in Benchmark’s senior investment professionals. In 2024, Miles Grimshaw left the firm to rejoin Thrive Capital, followed by the departure of Victor Lazarte and the transition of Sarah Tavel to venture partner. To replenish its leadership, Benchmark added new partners, including Randle, who was recruited from Kleiner Perkins, and Jack Altman, the brother of OpenAI CEO Sam Altman.

Why it matters

Benchmark’s move signals that even the most disciplined early-stage investors are being forced to adapt their models to the massive capital requirements of the current AI boom.