Michael Arrington is raising another CrunchFund
FORTUNE — Last spring we wondered about the future of CrunchFund, the early-stage venture capital firm led by TechCrunch founder Michael Arrington:
Some in Silicon Valley have whispered that Arrington is sitting at home in Seattle with his feet up, resigned to the notion that CrunchFund was a blogger’s failed investment experiment. Yesterday those rumors got even louder, with news that one of CrunchFund’s three partners — MG Siegler — had quit to join Google Ventures. From what I can tell, however, such speculation is totally unfounded…
To date, CrunchFund has invested just over half its capital into more than 80 companies. Ten of them already have experienced liquidity events — including “acqui-hires” — while only one has been written off. The current internal rate of return (IRR) is somewhere between 20% and 30%. That data signifies two things: (1) CrunchFund doesn’t actually need to raise a second fund yet, with plenty of dry powder in the till; and (2) CrunchFund should be able to raise a second fund when it does go out, based on performance.
Seems we were right.
CrunchFund today revealed in an SEC filing that it is in market with fund number two. The document suggests a $40 million ceiling, but my understanding is that CrunchFund actually is targeting around $30 million. That’s basically the same as the $28 million it raised for its first fund.
More importantly, my source says that CrunchFund already has held around a $25 million first close for the new fund, which includes a new commitment from founding investor AOL (AOL). No word yet on if many of the Silicon Valley venture capital firms that backed the inaugural CrunchFund came back for seconds — although it’s possible that they’d be in a susequent close.
CrunchFund has made more than 115 investments, including notables like AirBNB, Redfin, Path, Uber and Yammer (acquired by Microsoft). Most of its recent deals have been between $100,000 and $500,000 for early-stage companies.
Michael Arrington declined to comment, likely due to SEC marketing restrictions.
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