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Illustration: Rebecca Zisser/Axios

In early 2017, venture capital firm CRV decided to raise a dedicated growth equity fund that would be led by General Atlantic vet Brett Rochkind.

But it's not happening anymore, even though CRV raised the money. And Rochkind is leaving.

The original plan

In short, CRV believed its dedication to early-stage investing had cost it opportunities, both in terms of follow-on investments for existing portfolio companies and later-stage rounds for select companies where it had passed on the Series A (e.g., Ring).

  • As we reported last May, the firm decided to raise up to $400 million for a growth equity fund and another $400 million for its 17th flagship fund. The first page of its investor pitch-deck said: "One team, two funds."
  • CRV got over $700 million in total commitments, including $400 million for the early-stage flagship.
The revised plan

CRV changed its mind before calling any capital for either fund, and instead worked with LPs to close on $600 million for a single vehicle that includes an allocation of up to $150 million for growth equity. Rochkind will step down as a CRV partner, but will remain a senior advisor.

  • The extra $130 million was effectively given back, which means some investors were pared back and others were knocked out altogether.
  • For VC history buffs (come on, it might be a thing), CRV was among several firms that returned lots of uncalled capital during the dotcom bust, deciding it had raised more than they could reasonably invest.
What happened

Sources say is that this was mostly an issue of cultural fit.

For example, Rochkind wanted a private equity-type staffing model (i.e., junior analysts) that was anathema to CRV's mentorship-driven process for venture associates. Sources insist that there is no personal animus between CRV and Rochkind, just that the two sides realized that "one team, two funds" was easier said than done.

CRV statement to Axios:

"CRV is one of first firms in country to raise a 17th fund and we are incredibly honored by the support from the two audiences that matter most: Entrepreneurs and LPs. The new fund allows us to execute on our continued early-stage focus but with an additional mandate to invest in very selective growth opportunities we believe can drive venture returns."

Go deeper

Updated 5 hours ago - World

U.S. airstrike kills senior al-Qaeda leader in Syria, DOD says

A displacement camp near the village of Qah in Syria's northwestern Idlib province. Photo: Ahmad Al-Atrash/AFP via Getty Images

A U.S. airstrike in northwest Syria on Friday killed senior al-Qaeda leader Abdul Hamid al-Matar, U.S. Central Command said in a statement.

Why it matters: Syria serves as a "safe haven" for the extremist group to plan external operations, according to U.S. Army Maj. John Rigsbee.

Updated 10 hours ago - Politics & Policy

Giuliani associate Lev Parnas convicted of campaign finance crimes

Lev Parnas, a former associate of then-President Donald Trump’s personal lawyer Rudy Giuliani. Photo: Stefani Reynolds/Bloomberg via Getty Images

Florida businessman Lev Parnas was convicted Friday on charges of conspiracy to make foreign contributions to political campaigns, according to multiple outlets.

Why it matters: Prosecutors said Parnas, then an associate of former President Donald Trump's personal lawyer Rudy Giuliani, funneled over $150,000 from a Russian businessman into U.S. campaigns as part of an effort to land licenses in the U.S.'s legal cannabis industry.

Supreme Court agrees to hear challenges to Texas abortion law

Photo: Saul Loeb/AFP via Getty Images

The Supreme Court on Friday agreed to hear two cases challenging Texas' abortion law, which bans the procedure as soon as six weeks into pregnancy, but left the law in place in the meantime.

Why it matters: The court is moving extraordinarily fast on the Texas cases, compressing into just a few days a process that normally takes months. And that schedule means the court will take up Texas' ban a month before it hears another major abortion case — a challenge to Mississippi's own 2018 ban on abortions after 15 weeks.

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