For years, many venture capital firms avoided investing in startups that directly competed. Benchmark's partners say the rapid pace of artificial intelligence is making that longstanding practice harder to maintain.
Speaking at TechCrunch Disrupt, partner Eric Vishria said companies can pivot and expand quickly, creating overlaps that investors may not have anticipated when they first backed a startup. He said Benchmark remains committed to founders and keeps information it receives confidential, while noting that exclusivity matters most in a company's earliest stages.
Partner Chetan Puttagunta said AI is accelerating the trend by lowering the effort required to build software and encouraging founders to pursue broader opportunities. As startups grow into new markets, their products may increasingly intersect with those of other companies in an investor's portfolio.
Peter Fenton described these situations as a significant challenge for the firm. Benchmark's approach, he said, is grounded in transparency: founders should be told about potential conflicts rather than surprised later, and should not feel disadvantaged if one arises.
Benchmark is not abandoning its preference for early-stage exclusivity. Its partners' comments instead point to a venture landscape where company boundaries can shift quickly. Clear communication and strong confidentiality practices may become increasingly important as AI reshapes how startups build and compete.
