Benchmark maintains disciplined investing approach despite market pressures and $2 billion fund expansion
The venture firm's five general partners say they are holding to their core investment philosophy of 2-3 bets per year per partner and unstructured Monday partner meetings, even as the firm has doubled its capital raising.
What happened
Benchmark announced $2 billion across two funds this summer, marking only the second time in its 31-year history that it has raised such a large vehicle. The firm held its core fund at $500 million for 20 years before raising it due to inflation; it also launched a new $1.25 billion growth fund to pursue later-stage opportunities it previously turned down. At TechCrunch Disrupt, five Benchmark general partners—including recently hired Ev Randall and Jack Altman—were gathered together. The firm invests at its traditional pace of two or three new bets per year per partner. Partner meetings have no agenda and focus on what companies partners are meeting, what piqued their interest, and what appears in board meetings.
Context
Benchmark's approach stands apart from rivals accelerating their deployment and expanding team hierarchies. The firm's discipline reflects a belief that concentrated portfolios—where one or two investments generate 90% of returns—outperform larger bets spread across many companies. By adding a growth fund, Benchmark gains permission to pursue companies at later stages that could return 10 to 1,000x, which the firm previously passed on due to its early-stage mandate. The firm's resistance to formal processes and emphasis on small partnership structure aligns with recently hired partners' prior experiences; Altman cited the team's focus on founder support over money and status as a draw in a volatile market.
What's disputed
The number of investments Benchmark will make from the growth fund remains unsettled among partners themselves. Partner Peter Fenton stated his preference for 4-6, possibly 7-8 bets, but acknowledged that "we all have different answers, which is the beauty of a partnership." Whether Benchmark's single partner can veto a deal is unclear; when asked, partner Chethan Puttagunta said "Nobody knows. We don't have rules around it."