Silicon Valley venture capital firm Benchmark has completed a new $2 billion funding round and established its first dedicated growth fund. According to the Wall Street Journal, citing sources familiar with the matter, $1.25 billion will be allocated to later-stage investments, while another $750 million will be invested in early-stage projects.
This means that Benchmark is breaking with its long-standing investment practices. For the past two decades, the institution has kept the size of each fund at approximately $425 million, focusing primarily on early-stage startups and emphasizing rigorous screening and high equity holdings.
AI-driven financing boosts fund size
In recent years, funding for AI startups has risen rapidly, especially for companies developing foundational models, with single-round funding often reaching hundreds of millions of dollars. Benchmark's existing funds are relatively small, making it difficult for them to participate in such high-investment projects.
The report noted that Benchmark had not previously invested in Anthropic, OpenAI, or other AI labs with high funding needs. The newly established growth fund indicates that it is beginning to reserve space for larger, later-stage funding rounds.
Meanwhile, the newly established $750 million early-stage fund gives Benchmark greater flexibility in an environment of rising valuations. While the firm previously focused primarily on Series A funding rounds, it has gradually expanded its investment scope in recent years to earlier or broader stages such as seed and Series B rounds.
Participated in Series B and Pre-IPO projects
Benchmark has invested in two Series B AI companies in recent months: Gumloop, a no-code AI agent platform, and Monaco, an AI-native sales and CRM platform. This indicates that its investment pace is no longer limited to the traditional early-stage window.
Benchmark has also ventured into later-stage projects. TechCrunch previously reported that the firm participated in Cerebras' pre-IPO $1 billion funding round through a $225 million special purpose vehicle. Benchmark had previously led Cerebras' Series A funding round in 2016.
Cerebras completed its IPO last month. According to reports, Benchmark's book return at the IPO price was approximately $3.25 billion. This exit is considered one of the key reasons for its establishment of an independent growth fund.
Partner team adjustments
In addition to changes in fund structure, Benchmark has also been adjusting its partner lineup over the past two years. In 2024, Miles Grimshaw left the firm and returned to Thrive Capital. Subsequently, Sarah Tavel moved to a less involved venture partner position, while Victor Lazarte left to start his own venture capital firm.
To bolster its team, Benchmark brought in two new investors: Everett Randle from Kleiner Perkins and Jack Altman, brother of OpenAI CEO Sam Altman.
From fundraising size and investment stage to team configuration, this venture capital firm, long known for its restraint, is moving towards a model more suitable for the AI era. Sources familiar with the matter say the newly established growth fund is expected to make five to six large investments, covering existing portfolio companies and new startups.
