Ebay VC explains the secrets of a Midas touch
Harris Arch & Akshay Mansukhani, WH'04 & WH'03
Issue date: 11/6/00 Section: Undergraduate
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Speaking to a packed crowd of eager MBA students, Andy Rachleff, a general partner in Benchmark Capital, related his extensive experience in the field of venture capital. In the current economy, Rachleff, a 1980 Wharton graduate, stressed the critical demand for venture capital in order to support nascent technological start-ups.
Benchmark Capital, however, is unlike traditional venture capital firms.
Benchmark prides itself on a flat structure, where all team members are considered equal partners. Consequently, when Benchmark accepts an individual into the firm, the person has exactly the same share and position as partners who have been with the company for several years. This unique approach eliminates a hierarchy and in the Rachleff’s words, “takes politics out of the equation.” The egalitarian structure also allows entrepreneurs efficient access to the resources of all the partners.
When Rachleff started Benchmark in May 1995, the technological environment was very different than the present. It was “really the beginning of the commercial Internet,” said Rachleff. In 1995, Internet empires such as eBay and Amazon.com were in their infancy.
At the time, Rachleff and his partners formulated what became the core of Benchmark’s strategic mission statement: Help great entrepreneurs build major enterprises.
He focused specifically on the areas of e-commerce and infrastructure, seeking to “associate with more great companies than anyone else.”
Benchmark continues to follow this quest to excel in providing venture capital to successful businesses. Rachleff seeks the leaders, not the followers, of a particular industry. He concentrates on companies that are currently in a small market, but have bright prospects for substantial market growth. Notable Internet companies such as eBay, Webvan, Ariba, Northpoint and Juniper are among Rachleff’s impressive portfolio.
Benchmark provides necessary additions to start-ups by recruiting talented executives from larger companies and contributing valuable advice to the entrepreneurs. This support enables the companies to develop and expand while establishing a business foundation for the future.
Benchmark Capital, however, is unlike traditional venture capital firms.
Benchmark prides itself on a flat structure, where all team members are considered equal partners. Consequently, when Benchmark accepts an individual into the firm, the person has exactly the same share and position as partners who have been with the company for several years. This unique approach eliminates a hierarchy and in the Rachleff’s words, “takes politics out of the equation.” The egalitarian structure also allows entrepreneurs efficient access to the resources of all the partners.
When Rachleff started Benchmark in May 1995, the technological environment was very different than the present. It was “really the beginning of the commercial Internet,” said Rachleff. In 1995, Internet empires such as eBay and Amazon.com were in their infancy.
At the time, Rachleff and his partners formulated what became the core of Benchmark’s strategic mission statement: Help great entrepreneurs build major enterprises.
He focused specifically on the areas of e-commerce and infrastructure, seeking to “associate with more great companies than anyone else.”
Benchmark continues to follow this quest to excel in providing venture capital to successful businesses. Rachleff seeks the leaders, not the followers, of a particular industry. He concentrates on companies that are currently in a small market, but have bright prospects for substantial market growth. Notable Internet companies such as eBay, Webvan, Ariba, Northpoint and Juniper are among Rachleff’s impressive portfolio.
Benchmark provides necessary additions to start-ups by recruiting talented executives from larger companies and contributing valuable advice to the entrepreneurs. This support enables the companies to develop and expand while establishing a business foundation for the future.