Altos Ventures, the Silicon Valley venture capital firm that has backed the likes of Roblox, Coupang, PandaDoc and Quizlet, has secured $500 million for its latest fund, according to SEC filings. The firm has been around for almost three decades and this is its largest fund to date.
Altos Ventures declined to comment on the filing or the new fund.
The multistage VC firm manages over 15 funds across three vehicles, according to PitchBook. They include Altos Ventures and Altos Hybrid funds, which invest in U.S. and global companies, as well as Altos Korea Opportunistic Fund, which targets startups in South Korea. Altos Ventures has more than $7 billion in assets under management.
Altos Ventures specializes in enterprise and consumer software sectors, with a strong focus on SaaS, consumer and mobile. The firm prides itself on being the “first institutional investor in high-growth, founder-led companies.”
The new fund is notable because it’s a signal that well-established firms are continuing to raise substantial capital, despite the cooling in other parts of the venture market. Fundraising, for example, has become more challenging for emerging fund managers, many later-stage startups are struggling to raise growth rounds, valuations are softer overall (especially when the company in question is not an AI company), and the IPO market has been sluggish for years.
In contrast to the select group of venture capital firms that have scaled up to multibillion-dollar funds over the last decade, Altos has taken a more restrained approach, consistently capping its funds below $1 billion every few years. That’s more in the vein of Benchmark, which has also stayed conservative, raising a $425 million fund earlier this year and an additional $170 million partners-only fund.
For these firms, maintaining a strategy focused on making initial investments in a select number of early-stage startups—and later-stage bets in Altos’ case—has proven more effective than raising massive multibillion-dollar funds chasing FOMO deals during both the ZIRP and current AI investment booms.
Data from Cambridge Associates, which builds and manages investment portfolios for institutional investors, backs up this trend: smaller funds have historically yielded higher returns. Reflecting this, CRV, a veteran venture firm over half a century old, recently returned more than half of its $500 million late-stage fund, citing the inflated valuations of mature startups.
Altos Ventures’ backers appear satisfied with the its investment strategy. The 28-year-old firm claims to have been the first and lead investor in more than 50 companies, with over a dozen portfolio companies going public or being acquired by publicly traded companies. To date, Altos has backed nearly 250 companies, according to PitchBook data.