Europe has plenty to gloat about in technology these days, from state-of-the-art cell phones to higher growth opportunities for Internet entrepreneurs and investors. Next up for the Old World is a venture fund run by

Benchmark Capital

, one of the most prominent -- and newest -- of the New World's VC community.

Benchmark said Monday it has formed a $500 million fund headquartered in London that will focus on European start-ups, particularly in wireless technologies. Benchmark general partner Robert Kagle said the new fund has hired two London-based general partners, each experienced in European investments. Kagle declined to name the new partners, however, presumably because they haven't officially left their current jobs.

The move into Europe is a first for Benchmark and a relatively unusual move for a Silicon Valley firm. Like most VC funds based on or near Sand Hill Road in Menlo Park, Calif., many of Benchmark's portfolio companies are within a morning's drive of the partners' conference room. Some of its more successful investments in the neighborhood have included online auction house

eBay

(EBAY) - Get Report

in San Jose, business software provider

Ariba

TST Recommends

(ARBA)

in Mountain View and Web consultant

Scient

(SCNT)

in San Francisco.

But the European opportunity appears to be worth the trip. Kagle said Benchmark has been investigating opportunities in Europe for about six to nine months. He personally became exposed to the German market through eBay's 1999 acquisition of German online auctioneer

Alando

and the subsequent launch of the eBay Germany auction site. He said Israeli technology companies are not specifically a target of the new European fund, though Israeli start-ups increasingly are appearing on Benchmark's radar screen.

The new fund doesn't compare in size to the

billion-dollar fund Benchmark raised last year, primarily from U.S. institutional investors. Kagle said, however, that $500 million -- which he suggested was extremely easy to raise -- would be more than enough to occupy the two initial European partners and a third to join the firm shortly. Kagle also noted that he and his five partners -- Bruce Dunlevie, Dave Beirne, Bill Gurley, Andy Rachleff and Kevin Harvey -- are contributing a total of $40 million to the new European fund. Although one of the most successful to exploit the Internet, Benchmark is one of Silicon Valley's newest. It will turn 5 years old in May.