Greylock intentionally caps new fund at $1.5B when it could have raised more
Despite being able to raise several times more, Silicon Valley venture firm Greylock Ventures chose restraint to provide closer support to its portfolio companies.
Greylock Ventures, one of the oldest and most prestigious venture capital firms in Silicon Valley, is intentionally resisting the trend of ballooning fund sizes. On Tuesday, the 61-year-old firm announced it had raised a $1.5 billion 18th fund. That is 50% higher than its previous $1 billion vehicle from 2023 and roughly matches the capital the firm raised across seed and flagship funds during the pandemic.
However, Greylock partner Saam Motamedi told TechCrunch that the firm could have easily raised a multiple of that figure, suggesting the partnership decided restraint was the better path at a time when fund sizes across the industry keep climbing. “Our mission is to be the most important partner to the most important entrepreneurs,” Motamedi said.
Greylock prides itself on introducing portfolio companies to top engineers and potential customers, as it did for Baseten, an AI infrastructure startup now valued at $13 billion. But Motamedi said Greylock can offer that level of support only by keeping the number of companies it backs small. The firm’s 10 partners make only one or two new investments each annually, a pace that will result in roughly 25 portfolio companies from this fund.
Like its predecessors, the new fund will focus primarily on incubating companies from the earliest stages and leading seed and Series A rounds. Greylock has a strong track record here, most notably security giant Palo Alto Networks, which launched inside Greylock’s offices 21 years ago, and email security startup Abnormal, incubated in 2018 and last valued at $5.1 billion.
Even so, Greylock doesn’t stick strictly to early-stage deals. It will also back high-potential later-stage companies. The firm’s 17th fund included three growth-stage bets: Anthropic, Revolut, and Wiz. The first investment in Anthropic came at a $183 billion valuation. Motamedi estimates roughly 15% of the new fund will go to later-stage startups, but he maintains Greylock is fundamentally an early-stage investor. As proof, he said that when partners meet every Monday, the agenda consists primarily of people’s names rather than company names. “We’re getting to know people even before they start a company. It’s really a bet on the person,” he said.
