In June, Menlo Ventures announced $3 billion in new capital across two funds, marking the largest raise in its 50-year history. Menlo Ventures XVII will invest primarily in seed and Series A companies, while Menlo Inflection IV will provide growth capital to startups at Series B and beyond.
Fund Targets and AI Focus
The new funds will target companies throughout the AI market, from foundational models and infrastructure to enterprise, healthcare and consumer applications. The new capital gives the Silicon Valley firm more flexibility to back companies from their earliest days through later funding rounds that can require hundreds of millions of dollars, according to Crunchbase News.
Portfolio Companies
Anthropic has become the most prominent company in Menlo’s AI portfolio. The firm first invested in the AI model developer in 2023 and has added to its investment in later rounds. Menlo’s other AI investments include Lovable, Suno, OpenRouter, Wispr, Fireworks AI, Modal, Skild AI, and Goodfire.
Investment Approach
Matt Murphy, a partner at Menlo since 2015, invests across AI infrastructure, developer tools and AI-native software and has led Menlo’s investments in companies including Anthropic, Lovable, OpenRouter, Harness, Semgrep and Legora. The firm’s relationship with Anthropic provided an early view into AI market direction, according to Crunchbase News.
Murphy noted that AI companies need more capital than previous generations of software companies and are staying private longer, with winners separating quickly. Menlo has invested $100 million in companies including Lovable and Suno and followed a similar doubling-down approach with Anthropic after an initial Series C investment. The firm is pursuing a barbell strategy with more aggressive late-stage commitments for select companies while maintaining high standards amid overfunding in many AI categories, according to Crunchbase News.
