This article originally appeared in Term Sheet, Fortune’s newsletter for deals and dealmakers. Sign up here.
Merus Capital has raised $85 million for its third fund. It’s around double the size of the early stage venture fund’s last fund, a $43 million vehicle. In the past, Merus has raised separate special purpose vehicles for its LPs to do follow-on investments in its most successful portfolio companies. Partner Salman Ullah explains that the larger fund streamlines that process.
Merus, which backs enterprise tech companies, has had three exits from its first fund: Ecommerce data company Runa sold to Staples, virtualization startup IOTurbine sold to Fusion.io, and a smaller exit to Facebook.
That includes artificial intelligence, which Ullah sees as an integral part of
“We think of a company as a recipe and AI is an ingredient. It’s just a component of that, and not an end in itself. It’s like saying you are diving deep into HTML. Sure, you need a web page, but it’s not enough.”