Benchmark partners: investing pace stays steady despite a frenzied market

The five general partners of Benchmark, a San Francisco venture capital firm, spoke at TechCrunch Disrupt this week about how they plan to keep their way of working while rivals speed up. It matters because Benchmark announced two funds totaling $2 billion this summer, only the second time in its 31-year history that it has moved away from raising a much smaller vehicle.

According to the partners, the pace has not changed: each makes two or three new investments a year. Their Monday partner meetings still have no agenda. Eric Vishria described them as an ongoing conversation about what has become possible in the past six months, which companies they are meeting and what they see in board meetings.

Fund size and team

Peter Fenton said the core fund was held at $500 million for 20 years, and raising it simply reflects inflation. The new $1.25 billion growth fund expands the firm's mandate: previously, some opportunities that might have returned 10 to 1,000 times were missed because of the early-stage focus. Fenton expects roughly four to eight investments from that fund.

The team has recently added Ev Randall, who worked at Founders Fund, Bond and Kleiner Perkins, and Jack Altman, who joined in February. Altman had previously raised a $275 million fund for his own firm. He said that since joining he has invested in chips, robotics and infrastructure.

Cerebras and competing companies

Vishria recalled that Benchmark invested in AI chipmaker Cerebras in the first round in spring 2016, though it had made no hardware investment in 10 years. Cerebras went public at $185 a share, jumped to $350 and is now back near $185.

The partners acknowledged that as companies expand quickly, conflicts can arise between competing startups backed by the same investors, and said they commit to maintaining confidentiality.