Reach Capital closes $265 million Fund V for AI specialists
The 11-year-old venture capital firm has secured an oversubscribed fund from limited partners including the LEGO Foundation and Capricorn Investment Group to back early-stage artificial intelligence founders.
San Francisco-based venture capital firm Reach Capital has closed its $265 million Fund V, an oversubscribed vehicle dedicated to backing artificial intelligence founders building applications in learning, health, and work. The fund, led by general partner Jomayra Herrera and platform head Tony Wan, represents the latest in a series of successful capital raises for the 11-year-old firm, which previously secured $215 million for Fund IV in 2023 and $165 million for Fund III in 2021.
The new fund will deploy capital between $1 million and $10 million into approximately 50 companies over the next three years, targeting investments from the pre-seed stage through Series A. According to Wan, the investment thesis centres on AI applications that “expand human potential” and serve human flourishing, rather than simply replacing human labour. The firm has not yet backed any companies through Fund V.
Limited partners contributing to the new fund include Capricorn Investment Group, the Los Angeles Fire and Police Pensions, the LEGO Foundation, and College Board. Herrera noted that the fundraising process was completed in less than six months, with the vast majority of existing limited partners doubling down their commitments and new marquee partners joining the syndicate.
The successful close of Fund V comes against a backdrop of a venture capital market exhibiting a “barbell shape,” where capital flows heavily toward giant brand-name funds and sharply focused specialists, while generalist firms struggle to attract attention. Analysis by PitchBook and the National Venture Capital Association indicated that established firms captured more than 90 per cent of the roughly $62 billion raised across U.S. venture capital funds through May 2026.
Reach Capital’s focus on sector-specific, conviction-based investments aligns with the specialist model that limited partners have remained open to funding. The firm’s track record includes previous investments in Replit, ClassDojo, and Coral Care, as well as a recent exit in June when Superhuman, now owned by Grammarly, acquired GPTZero. GPTZero, in which Reach was one of several investors, had reached over 19 million registered users and $30 million in annual recurring revenue prior to the acquisition.
