Institutional Venture Partners raises $1.4 billion for new late-stage fund

Institutional Venture Partners is one of the oldest venture capital firms on Sand Hill Road, having originally opened its doors back in 1980. That means it’s been through several economic cycles, but never before has there been more capital flowing to the sorts of later-stage tech companies in which IVP tends to invest. So, not surprisingly, it has just raised the largest fund in its 35-year history.

IVP today will announce that it has closed its fifteenth fund with $1.4 billion in capital commitments. Most of that money came from existing limited partners in its fourteenth fund, which raised $1 billion back in early 2012.

“The size of private financings has increased considerably since our last fund, and to be a leader in late-stage you need to be able to lead in price,” explains Steve Harrick, a general partner with IVP. “That means you need the ability to invest $40 to $60 million depending on the situation, but we also want to keep being able to do $10 million deals… The reason we still want that flexibility is that it’s the right company, not the largest round size, that moves the needle. For example, we invested only $14 million into Twitter (TWTR) in 2009 — because we couldn’t get any more in — and if we had insisted on a $30 million or $40 million minimum check size, we would have missed out.”

IVP is not making any investment strategy changes with the new fund, but there is a bit of personnel news: Norm Fogelsong is stepping back into an advisory role after 26 years as a general partner with the firm. New general partners this time around are Somesh Dash and Eric Liaw, bringing the overall group to seven.

Active IVP portfolio companies include and Dropbox, HomeAway, Puire Storage, Snapchat and Zenefits.

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