Menlo Ventures Announces Largest Raise in 50-Year History
In June, Menlo Ventures announced $3 billion in new capital across two funds. Menlo Ventures XVII will invest primarily in seed and Series A companies. Menlo Inflection IV will provide growth capital to startups at Series B and beyond. The new funds target companies throughout the AI market from foundational models and infrastructure to enterprise, healthcare and consumer applications.
The new capital gives the firm more flexibility to back companies from their earliest days through later funding rounds. AI has become central to Menlo Ventures, previously known for investments in Uber, Roku and Siri.
Anthropic Leads Menlo’s AI Portfolio
Menlo Ventures first invested in Anthropic in 2023 and has added to its position in later rounds. Anthropic is the most prominent company in Menlo’s AI portfolio. Other AI investments include Lovable, Suno, OpenRouter, Wispr, Fireworks AI, Modal, Skild AI and Goodfire.
Matt Murphy, a partner at Menlo since 2015, has led the firm’s investments in Anthropic, Lovable, OpenRouter, Harness, Semgrep and Legora. Murphy spent 15 years as a general partner at Kleiner Perkins before joining Menlo, where he served as an observer at Google from initial investment through IPO and helped launch the $200 million iFund with Apple.
Larger Checks and Concentrated Bets
Murphy stated that AI companies need more capital than previous generations of software companies and are staying private longer. The larger fund size allows Menlo to partner with founders from company formation through hypergrowth. The firm has invested $100 million in companies including Lovable and Suno.
Menlo first invested in Anthropic in the Series C round and led the Series D round, which was the largest investment the firm had made at the time. The firm is pursuing a barbell approach with more aggressive stage- and capital deployment for select later-stage AI companies while maintaining a high bar overall.
Phase 2 of the AI Market
Murphy noted that Menlo is moving from Phase 1 to Phase 2 of the AI market. The firm sees an entirely different set of opportunities and challenges as winners separate quickly and compound at unprecedented rates.
According to Crunchbase News, Menlo is changing how it invests while pursuing more concentrated positions in breakout AI companies.
The $3 billion raise marks the largest in Menlo’s history and reflects the scale required for AI infrastructure and application companies.
