Benchmark Capital, the Sand Hill Road firm that has enjoyed a succession of exits since its 1995 founding — including eBay, Juniper Networks, Red Hat, and, more recently, OpenTable — has closed on $425 million for its seventh fund, according to a source familiar with the fund.
(UPDATE: General Partners Bob Kagle, who led Benchmark’s investment in eBay, and Alex Balkanski, apparently won’t be GPs in fund VII, according to a regulatory filing. See full story here.)
Benchmark raised $500 million for its sixth fund in 2008 and $400 million for its fifth fund in 2004, according to Thomson Reuters (publisher of peHUB).
PeHUB has sought comment from Benchmark and will update this post when we hear back.
Says an institutional LP in fund VII that declined to be named: “Benchmark is really differentiating itself by focusing in on early-stage venture and keeping the fund size at a very reasonable level — especially given the talent on the team and the number of partners at the firm.” When other firms are expanding into various other directions and stages and generally raising much larger funds, said this person, “Benchmark — whose new fund was oversubscribed — decided to maintain its fund size and focus on what they do best.”
Certainly, Benchmark’s success in recent years — amid troubled economic times — has been stunning. The firm had more than a dozen exits in 2009, including the sale of Pure Digital to Cisco Systems for $590 million and the public offering of OpenTable. In 2009, it also sold feed aggregator FriendFeed to Facebook for $50 million in cash and stock. (The deal remains Facebook’s biggest acquisition to date.)
Last year, Benchmark’s exit streak slowed somewhat. One of its few outcomes was the sale of the 5-year-old semantic search startup MetaWeb to Google. (Terms of the deal weren’t disclosed.) But Benchmark’s attractive portfolio could wring out huge returns for its investors.
Among Benchmark’s most promising companies are Twitter, Yelp and Zillow, along with a number of other companies that have publicly disclosed enough revenue to presumably go public in the not-too-distant future. One of those is Art.com, an online seller of art and décor items that has been pulling in more than $100 million in revenue for each of the past four years, according to the company. Another is the call-center company LiveOps, which told the Wall Street Journal last year that it had generated more than $125 million in revenue in 2009 and is exceedingly profitable.
That’s saying nothing of ZipCar — the car-sharing service that’s currently in registration for a $75 million offering — or newer investments like the popular question-and-answer service Quora, which Benchmark backed with $11 million in a highly competitive financing that took place in March of last year.