Is there life at Benchmark after Uber?

Is there life at Benchmark after Uber?

Is there a next act for one of Silicon Valley’s top investors after Uber? Benchmark and Bill Gurley are about to find out. Questions swirl around the venture capital firm as it prepares to raise a new fund within the next year, writes Recode.

Benchmark is one of tech’s most powerful venture capital firms, and, at 6’9”, Bill Gurley is literally one of its biggest celebrities. So as his firm prepares for its next chapter and a new pool of money, there are a number of questions that Silicon Valley has not been able to put to rest, despite endless fascination within the industry about one of its most aggressive investors.

Such as: Who’s staying and who’s calling it quits in a band that is famously close-knit? What happens to investors when they are too successful? And, more universally, can major tech players — not just venture capitalists — retain their star power while also trying to develop a younger generation to take their places?

These are particularly intense issues as Benchmark moves on from an exhausting fight over the leadership of Uber, which demanded most of its attention in 2017. The firm took unprecedented, divisive steps to oust Travis Kalanick, the CEO of its most valuable portfolio company, and ill will from that ugly battle still lingers.

“What my firm and I went through in 2017 was probably the least enjoyable experience of my life,” Gurley said at an industry conference in February. But the rest of 2018 will still be frantic as Benchmark prepares to raise its next fund, sources tell Recode. It is likely to once again raise about $425 million, although the firm has remained quiet even as questions swirl in Silicon Valley around the future of its six investing partners.

Gurley — the firm’s de facto leader and the partner who led its Uber investment — is expected to sign up for another 10-year fund, despite that commitment keeping him as a Benchmark partner into his early 60s, according to people close to the firm. That is unusual since Benchmark has a tradition that investors typically stop participating in new funds as general partners around the time they hit the 50-year-old mark (although there have been some exceptions).

Gurley, 52, has talked about investors staying on too long, praising Benchmark in the past for its “intentional bias towards youth.”

“Youth is a competitive weapon,” he wrote in a blog post in 2012. “Young VCs are open to new ways of doing things. This form of ‘rule-breaking,’ or intentionally ignoring yesterday’s doctrine, may in fact be a requirement for successful venture capital investing.”

Loping around high above the crowd, the outspoken VC has never been quiet about either his investments or his opinions about the investments of others. But he’s been much less voluble lately — he declined a request for an interview for this story.

Gurley has become newly animated by health care deals, sources say. And just last month he announced a new deal that some industry insiders read as a message that he isn’t stepping away from the hustle just yet: A $25 million check into Good Eggs, a get-your-hands-dirty attempt to restructure an online grocer that recently almost went bankrupt.

Also expected to recommit to the next fund is Peter Fenton, who led Benchmark’s early investments in companies like Twitter and Elastic, which just filed to go public. Fenton has spent a good amount of his time in recent years in France, although he is described as still “in the game” and active on boards.

But one investor who is widely expected to not sign up for another round of deals is Mitch Lasky, who was responsible for Benchmark’s 2013 bet on Snap, which went public at more than $20 billion. Lasky, who at 56 is the oldest Benchmark partner, has talked about stepping down in future funds for the last few years, sources said.

Plus, “there are other things he‘d like to do at this point in his life,” one person close to him said. Benchmark declined to comment.

The lineup of VCs is especially important at a place like Benchmark because it, more than any other firm, points to the cohesion of its six-person team of equals as a selling point against more expansive — and, in their view, undisciplined — rivals. With an equal splitting of their financial success, the firm is said to have particularly low tolerance for less-than-committed investors.

No decisions are final, and Benchmark’s own investors, its so-called limited partners, will not be made aware of the investing roster until the firm begins marketing its next fund, people close to the firm say. VC firms often announce partner retirements in association with new funds.

Continue reading: https://www.recode.net/2018/6/25/17466508/benchmark-bill-gurley-changes-vc-firm-fund

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