CRV Raises $750M Amidst Downsizing - Venture Capital News

CRV Closes $750 Million for its Twentieth Flagship Fund

CRV announced on Friday that it has successfully secured $750 million in commitments for its twentieth flagship fund. This represents a significant investment in the 55-year-old venture capital firm’s continued operations.

Fund Size and Strategy

The current fund is being launched at a slightly reduced size compared to the $1 billion early-stage fund CRV finalized in the autumn of 2022. Previously, alongside this earlier fund, a $500 million second Select fund was also established.

Notably, CRV is not currently pursuing a late-stage fund as part of this new fundraising effort. This decision follows the firm’s announcement last year to The New York Times regarding the return of $275 million from its $500 million Select fund to investors.

Rationale for Strategic Shift

CRV determined that pursuing further late-stage investment vehicles was not optimal. The firm projected that subsequent funding rounds for its portfolio companies could potentially diminish overall returns.

Investor Demand and Fund Deployment

Limited partners demonstrated strong enthusiasm for supporting CRV’s smaller fund. The entire $750 million was raised within a remarkably short timeframe of just four weeks.

Demand for investment in the fund actually exceeded the target, reaching double the amount sought by CRV. The capital will be allocated to investments in startups during their seed and Series A stages.

Investment Focus

CRV’s investment strategy will prioritize companies operating within the consumer and devtools sectors. These areas represent key opportunities for growth and innovation.

CRV’s Track Record

CRV has a distinguished history of successful investments. The firm is recognized for its early backing of DoorDash, providing seed funding, and leading the Series A rounds for both Mercury and Vercel.

Vercel, a cloud platform catering to web developers, most recently achieved a valuation of $3.25 billion. Since its inception in 1970, CRV has supported over 750 startups, with 80 ultimately achieving an initial public offering (IPO).

Recent Investments

Recent additions to CRV’s investment portfolio include CodeRabbit, a startup specializing in AI-powered code review, and Outtake, a cybersecurity company leveraging artificial intelligence.

These investments highlight CRV’s commitment to supporting innovative companies at the forefront of technological advancement.