In partnership with
March 26, 2026
Good morning, Private Market enthusiasts.
It's Alberto.
2023. A partner at Sequoia Capital walked into a Monday morning meeting and said:
"We just watched a chatbot pass the bar exam. Everything we know about venture capital just changed."
Two years later, the data proves him right.
AI startups captured 41% of all venture capital in 2025.
That's $52 billion out of $128 billion total. Nearly half.
But here's the part that should terrify everyone who dismissed AI as hype:
The returns are actually good.
Read time: 5 minutes
The Key to This $240B Market Is in Your Bloodstream
Every year, $240B is spent on treating the symptoms of osteoarthritis. But not a single therapy has been able to actually stop it. The answer, it turns out, has been inside us all along.
A startup named Cytonics discovered the human body already produces a protein designed to protect cartilage. It just doesn’t produce enough where it's needed most. So Cytonics harnessed it.
Their first-generation therapy has already treated 10,000+ patients. Now they've engineered a 200% more potent, mass-producible version pushing toward FDA approval.
If approved, it could be the first therapy to actually halt cartilage destruction and promote regrowth in a market that has never had a real solution. Claim a piece at the pre-clinical stage as an early-stage investor before March 26 to receive time-sensitive investor bonuses.
This is a paid advertisement for Cytonics Regulation CF offering. Please read the offering circular at https://cytonics.com/
PRIVATE MARKETS
The Numbers Don't Lie
According to Carta's latest data (which tracks over 50,000 companies):
2025 Venture Capital:
Total raised: $128 billion
AI's share: $52 billion (41%)
Non-AI's share: $76 billion (59%) — split among everyone else
But the concentration is even more extreme:
10% of startups captured 50% of all funding.
Translation: If you're an AI company, you're in the 10% getting $64 billion. If you're not, you're in the 90% fighting for $64 billion.
The math is brutal.
PRIVATE MARKETS
The Mega-Rounds That Broke Everything
Here's what happened in just 90 days (Q4 2025 to Q1 2026):
January 2026: xAI raises $20 billion Series E
February 2026: OpenAI raises $110 billion at $730 billion valuation (one of the largest private rounds ever)
March 2026: Anthropic raises $30 billion Series G at $380 billion valuation
Total: $160 billion raised by three companies in three months.
For context:
That's more than the entire U.S. venture capital market raised in 2020 ($156 billion).
Three companies. Three months. $160 billion.
PRIVATE MARKETS
Why AI Rounds Are So Big
You might think: "They're raising billions because they have thousands of employees."
Wrong.
Peter Walker, head of insights at Carta:
"AI startups are raising bigger rounds not because they have lots of employees — they don't — but because the cost of running AI models is high."
Translation:
OpenAI doesn't need $110 billion to hire people.
It needs $110 billion to:
Buy GPUs from Nvidia ($30B-$40B)
Build data centers ($20B-$30B)
Pay cloud computing costs ($15B-$25B)
Train increasingly expensive models ($10B-$20B)
The burn rate is insane.
OpenAI is losing $14 billion in 2026 alone.
But investors don't care. Because the TAM (total addressable market) is "every white-collar job on Earth."
Here's what Premium members get:
✅ Early access to AI infrastructure deals (Series A/B, before $500M Series C)
✅ Full investment memos on pre-IPO AI companies (detailed financials, risk analysis, upside potential)
✅ Deal allocation (first-come, first-served when we secure access)
✅ Weekly private markets research (where capital is flowing, what's overvalued, what's underpriced)
$100/month locks in your lifetime rate.
After this week, Premium goes to $120/month forever.
PRIVATE MARKETS
The K-Shaped Market
Venture capital in 2026 is now officially K-shaped.
The top branch (AI companies):
Round sizes: $200M-$500M average
Valuations: 50x-100x revenue
Investor appetite: Infinite
Competition for deals: Extreme
The bottom branch (everyone else):
Round sizes: $10M-$30M average
Valuations: 8x-15x revenue
Investor appetite: "Show me unit economics"
Competition for funding: Brutal
Example:
AI infrastructure startup raises $450 million Series C at $5 billion valuation with no revenue.
Meanwhile, a profitable SaaS company with $20M ARR struggles to raise $15M Series B.
The disconnect is real.
PRIVATE MARKETS
But Here's the Twist: The Returns Are Actually Good
For two years, skeptics said:
"This is 2021 all over again. These valuations are insane. The bubble will pop."
Then the data came out.
Carta analyzed fund performance by vintage year (the year funds were raised):
Funds raised 2017-2022 (pre-ChatGPT):
IRR (internal rate of return): Declining
DPI (distributions to paid-in capital): Falling
Hold periods: Stretching to 11+ years
Funds raised 2023-2024 (post-ChatGPT launch):
IRR: Highest in the dataset
Performance: Beating all previous vintages
Reason: AI investments paying off FAST
Translation:
The VCs who bet big on AI in 2023-2024 are already seeing returns that justify the hype.
PRIVATE MARKETS
Why AI Returns Are Beating Everything
Three reasons:
1. Enterprise adoption is real
2023: "Let's experiment with AI"
2026: "AI or die"
Companies are spending 10-20% of IT budgets on AI. That's $500B-$1T annually shifting to AI vendors.
2. Revenue scaling is fast
Traditional SaaS: Takes 5-7 years to hit $100M ARR
AI companies: Hitting $100M ARR in 18-24 months
Example:
Anthropic: $0 → $19B revenue run rate in 30 months
OpenAI: $0 → $20B revenue run rate in 24 months
3. Exit multiples are insane
OpenAI at $730B valuation on $20B revenue = 36.5x revenue
Anthropic at $380B on $19B revenue = 20x revenue
Traditional SaaS exits at 8-12x revenue.
AI is getting 2-4x the exit multiples.
The Risk Everyone's Ignoring
But let's be honest about the downside.
OpenAI's path to profitability:
2026 revenue: $20B 2026 loss: -$14B Cash flow positive: 2029-2030 (projected)
The math:
They need to burn $40B-$60B MORE before breaking even.
If the $110B round was at $730B valuation, and they IPO in Q4 2026 at $830B-$1T...
Early investors: Made 625x (if they got in at Series A)
Latest round investors: Making 14-37% (if IPO hits high end)
The question:
Are you investing in the next OpenAI at Series A (625x potential)?
Or are you buying the $110B round at $730B (14% potential)?
Timing is everything.
What Carta's Data Actually Shows
Let's zoom out.
The big picture:
Venture capital raised $128 billion in 2025.
AI took $52 billion (41%).
But more importantly:
Funds that invested in AI in 2023-2024 are posting the best IRRs in 20 years.
This isn't hype.
This is the fastest capital rotation in venture capital history.
And if you're not positioned for it, you're watching from the sidelines.
At Founderscrowd, We're All In
We've been saying this since 2022:
AI infrastructure is the biggest investment opportunity of the decade.
Not consumer AI. Not AI chatbots.
Infrastructure.
The picks and shovels.
The companies selling GPUs, building data centers, and providing the compute that powers every AI model.
Why?
Because whether OpenAI wins or Anthropic wins or xAI wins...
They all need the same thing: infrastructure.
The Bottom Line
AI startups took 41% of all venture capital in 2025.
The top 10% of companies got 50% of all funding.
And the returns are justifying the concentration.
2023-2024 vintage funds (post-ChatGPT) are posting the highest IRRs in 20 years.
This isn't a bubble.
This is the market repricing around the biggest platform shift since the internet.
The question isn't "Is AI overhyped?"
The question is: "Are you positioned for it?"
41% of venture capital went to AI in 2025.
The returns are good.
The concentration is extreme.
Are you in the 41% or the 59%?
See you Saturday. ☕
Alberto
Sources
Carta: 2025 Venture Capital Report (March 20, 2026)
TechCrunch: "AI startups are eating the venture industry" (March 20, 2026)
Crunchbase: 2026 VC funding data
PitchBook: AI startup valuations and round sizes