Primary Ventures raises healthy $625M Fund V to focus on seed investing

Primary Ventures has officially unveiled its latest investment initiative, a substantial $625 million Fund V that aims to focus on seed investments across the United States. This significant amount underscores the escalating scale of early-stage funding, particularly in the context of rapid advancements in artificial intelligence (AI). Ben Sun, co-founder and general partner at Primary Ventures, shared insights with TechCrunch, revealing that the average investment from this fund is expected to fall between $5 million and $10 million. He anticipates that the firm will engage with 40 to 50 startups over the next three years, extending its reach even to pre-seed stages. Historically, Primary Ventures has been a prominent player in New York's venture capital scene, primarily concentrating its investments in the city. However, Sun noted a significant shift in their strategy, with the firm now actively pursuing opportunities in various locations, including Chicago, Seattle, Virginia, and Washington, D.C. "The talent, the founders, and the startups are emerging everywhere," he emphasized. "The potential outcomes are unprecedented." Sun believes that seed investing is evolving into its own distinct asset class, driven by the increasing quality of entrepreneurs and their innovative projects, coupled with the current technological transformation. With heightened competition among firms to secure the most promising deals, he stated, "A fund of this size enables us to compete effectively and provide more resources to collaborate with top founders and opportunities." Notably, other major firms have also made headlines with their recent fundraising efforts, including Sequoia, which raised a $200 million seed fund, and UnCorck Capital, which announced a $225 million seed fund last year. While Primary Ventures identifies as a generalist firm, Sun indicated that it has sector specialists focusing on various fields, such as consumer products, vertical AI, fintech, healthcare, cybersecurity, and infrastructure. "We cover probably 80% to 90% of the seed sector activities available," he remarked. Fund V has already made its mark by investing in three startups. Over the years, Primary Ventures has progressively increased its fundraising efforts, starting with $60 million in Fund I in 2015, followed by $100 million in Fund II, $150 million in Fund III, and a $275 million fund along with an additional $163 million for an opportunity fund. Notable investments include the AI chip company Etched, the risk management platform Alloy, the networking hub for women Chief, and the AI marketplace Dandelion Health. Currently, the firm manages $1.65 billion in assets.