VC Lands Fund in Tough Environment

Greylock Partners on Monday announced the closing of a $575 million fund, Greylock III, and said Reid Hoffman is joining as an investing partner.

San Mateo-based Greylock plans to use the funds to invest in enterprise and consumer software, services, and infrastructure ventures.

The funding comes at a tough time for venture firms trying to raise money. The list of firms to raise money is short and includes Khosla Ventures and Sequoia Capital.

Hoffman, the co-founder of Mountain View-based LinkedIn Corp., joins Greylock as a partner. He will remain active executive chairman at LinkedIn, the firm said.

In his role at Greylock Partners, Hoffman will invest in promising early-stage consumer Internet and software ventures, as well as coach and advise entrepreneurs of Greylock portfolio companies.

“I have worked closely with Reid as a board director at LinkedIn for the past five years and am thrilled to welcome him to the partnership,” said David Sze, a partner at Greylock. Sze leads the firm’s investments in LinkedIn as well as Digg, Facebook, Pandora and others.

“As a Greylock entrepreneur, I witnessed firsthand the firm’s ability to help entrepreneurs become successful by focusing on company building and staying true to the firm’s values. I look forward to continuing that legacy,” said Hoffman. “I am deeply passionate about partnering with entrepreneurs to build companies that make a lasting impact.”

Prior to LinkedIn, Hoffman served as executive vice president at San Jose-based PayPal Inc. where he was a founding board member.