"Turpentine VC" | Venture Capital and Investing

E78: Why Benchmark is Different Than Other Firms with Sarah Tavel & Eric Vishria

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In this episode of Turpentine VC, we're sharing Erik Torenberg's 2023 interview with Sarah Tavel and Eric Vishria from Benchmark, exploring the firm's unique minimalistic approach, commitment to deep founder partnerships, and their deliberate avoidance of platform teams.


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LINKS:

Benchmark: https://www.benchmark.com/

Dopamine Nation: https://www.amazon.com/Dopamine-Nation-Finding-Balance-Indulgence/dp/152474672X 


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X / TWITTER:

@sarahtavel

@ericvishria

@eriktorenberg

@turpentinemedia


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HIGHLIGHTS FROM THE EPISODE:

  • Benchmark was founded in 1995 as an "internet era" firm, distinct from semiconductor era firms like Sequoia (1970s) and mobile era firms like Andreessen Horowitz (2009).
  • The firm operates with six equal partners who split economics equally and make just 1-2 investments per year each.
  • Benchmark intentionally maintains no platform team, believing direct GP involvement leads to better founder outcomes.
  • The firm's Monday meetings have no agenda to encourage open-ended curiosity and foster creative thinking.
  • During 2020-2021, Benchmark's investment pace was historically slower due to the challenges of building relationships over Zoom.
  • The firm is currently on pace for making the most new investments in a year than they have in the past decade.
  • Benchmark sees three distinct opportunities in AI: foundational models, vertical companies selling work, and incumbent product enhancement.
  • The firm succeeded in crypto by focusing on company-building founders (Chainalysis, So Rare) rather than token-based speculation.
  • Benchmark prioritizes "seeing the present clearly" over making big macro predictions about the future.
  • The partners view their lack of a platform team as both a constraint on deal flow and a feature that ensures deep GP involvement.
  • The firm deliberately maintains consistent fund sizes and focused strategy, unlike peers who have expanded into multiple products.
  • Healthcare investments focus on peripheral areas (nurse marketplaces, medical devices) rather than core healthcare delivery.
  • The partners still cold email and DM founders directly, with no junior staff intermediating relationships.
  • The firm's equal partnership model intentionally doesn't scale beyond a small number of partners to maintain quality of collaboration.
  • Benchmark measures success by investment multiples rather than total capital returned, focusing on being in "the few deals that matter."
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    "Turpentine VC" | Venture Capital and InvestingBy Erik Torenberg
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