August Capital said today it has closed on $450 million for its latest venture capital fund, called August VII.
The new raise represents a downsizing of sorts for the 20-year-old Sand Hill Road firm. In 2012 August Capital raised $550 million for its sixth fund, August VI, and prior to that in 2009 raised $650 million for its fifth fund, August V.
In a blog post today, August Capital parter David Hornik explained that the smaller size was an intentional choice for the firm, bucking the larger industry trends of seemingly constant expansion to instead focus on quality over quantity. He wrote:
“The first half of this decade has been marked by ever bigger financings and ever bigger venture capital firms. Yet, as we approached the raising of August VII, we sat down as a partnership and asked ourselves what we wanted our new fund to look like. Did we want to raise a billion dollar fund and jump on the ‘ever bigger’ band wagon? Or did we want to stick to our knitting and focus on what we do best — supporting a manageable number of great entrepreneurs as they navigate the challenges of building game changing businesses? The answer to us was clear.”
He added that his team initially targeted to raise just $400 million for August VII, so that each of the fund’s five general partners would have $80 million to deploy. The fund was eventually stretched to $450 million, giving each partner $90 million to work with.