TechCrunchMichael Arrington’s CrunchFund is performing quite well, Dan Primack at Fortune reports.
He says the CrunchFund has a 20%-30% internal rate of return, which is about in line with what a venture capital fund is expected to deliver.
The CrunchFund is a source of fascination in the tech world because of Arrington.
He built TechCrunch, one of the most read tech publications, then sold it to AOL.
He was still at AOL when he decided to launch his own VC firm, the CrunchFund. His first big investor was AOL, which kicked in $8 million.
After word broke of the CrunchFund, AOL found itself in a mess, as there was outcry of conflict of interest for TechCrunch. Arrington was forced out of TechCrunch, and focused on the CrunchFund. He’s kept a relatively low profile since then.
The CrunchFund became a story again yesterday when one of its three partners, MG Siegler, announced he was bolting for Google Ventures. This kicked off a round of speculation that the CrunchFund was toast, says Primack.
Siegler’s departure from the fund was unexpected, says Primack. He only told Arrington about it last week.
Despite this, Primack says the CrunchFund is fine. It has invested about half of its $27 million into 80 companies with 10 of those companies having some sort of exit.
The fund has plenty of money to make more investments. If it wants to raise another round of funding, it has a decent early track record which should help.
There is gossip, however, that Siegler was sourcing a lot of the deals for the fund and now that he’s gone, the fund might have a harder time.