Menlo Ventures raises $3B to back AI startups

Silicon Valley venture firm Menlo Ventures has secured $3 billion in new capital across two funds, marking the largest fundraising effort in its 50-year history. The capital is split between Menlo Ventures XVII, which will target seed and Series A startups, and Menlo Inflection IV, designed to provide growth capital for Series B companies and beyond. Led by partner Matt Murphy, the firm is deploying this capital across the artificial intelligence stack, including foundational models, infrastructure, enterprise software, healthcare, and consumer applications.

The massive capital pool allows Menlo to make highly concentrated bets on breakout AI companies. The firm has already executed this strategy by investing in Anthropic, starting with its Series C round and later leading its Series D round. It has also deployed $100 million checks into app-building platform Lovable and music-generation startup Suno. Other notable investments in Menlo's AI portfolio include OpenRouter, Wispr, Fireworks AI, Modal, Skild AI, Goodfire, Harness, Semgrep, Legora, Chai Discovery, Gimlet, Greptile, and Flapping Airplanes. Murphy notes that while there are roughly 60 model companies in the market, Menlo has backed more than five of them, with plans to double down on the top performers.

For AI practitioners and founders, Menlo's massive capital injection signals a shift from early experimentation to production-grade scaling. Murphy highlights that the primary bottleneck for developers has shifted from initial model selection to deploying code into production quickly, safely, and securely. This transition is driving demand for software delivery and security tools like Harness, Semgrep, and Greptile. Furthermore, as enterprises adopt multi-model strategies and leverage open-source or open-weight models, infrastructure startups like Modal and Fireworks AI are becoming essential by aggregating compute capacity from providers like Nebius and CoreWeave. This funding surge ensures that developers building on these platforms will have the sustained financial backing needed to scale rapidly.