Best of LinkedIn: Venture Capital CW 27/ 28

Venture funding reached record headline levels, but capital increasingly concentrated around a small group of AI and frontier-technology leaders. The broader market remained selective, with LPs prioritising cash returns, managers testing new fund structures and founders facing tighter access to capital.

Date

July 16, 2026

Venture Capital

Thomas Allgeyer

Methodology: Every two weeks we collect most relevant posts on LinkedIn for selected topics and create an overall summary only based on these posts. If you´re interested in the single posts behind, you can find them here: https://linktr.ee/thomasallgeyer. Have a great read!

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Record Funding Masks a Narrower Market

Global venture funding reached $510 billion in H1, with OpenAI and Anthropic absorbing 43%
Five companies captured 73% of Q1 US investment, separating megadeals from traditional venture activity
North American investment values increased while deal volumes declined, widening the gap between headline and median conditions
MENA, Canada and Austin showed similar patterns, with strong totals driven by fewer large transactions

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AI Becomes an Infrastructure Asset Class

AI funding increasingly supports compute, power, networking, data centres and custom hardware rather than software alone
SambaNova raised $1 billion to scale disaggregated inference infrastructure and improve enterprise AI economics
JPMorganChase, Intel and Vista-backed Vector Core Compute supported SambaNova through deployment and technology partnerships
ZML secured $20 million and launched vendor-agnostic inference software across NVIDIA, AMD, TPU and other platforms
Energy availability, grid capacity and permitting emerged as critical determinants of AI infrastructure investment locations

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Liquidity Replaces Valuation as the Performance Priority

LP attention shifted from TVPI to DPI as portfolio valuations recovered faster than cash distributions
Longer exit timelines strengthened secondaries as a structural pathway alongside IPOs and acquisitions
Potential liquidity from major AI listings may primarily return to established funds and private-market assets
Venture returns remained dependent on occasional liquidity windows rather than consistently distributed exits
PayPal Ventures' closure showed that CVC survival depends on corporate strategy, not portfolio performance alone

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Fundraising Diverges Between Scale and Specialisation

US fund formation reached a decade low, with emerging managers experiencing the strongest fundraising pressure
European launches remained active across seed, AI, defence, deeptech, healthtech and industrial investment strategies
Vermilion Cliffs closed a $25 million second fund focused on AI infrastructure, security and developer tooling
Tapestry launched an $80 million third fund, while Anti Fund added a $100 million growth vehicle
Specialist models expanded through frontier-technology funds and project-financing vehicles for independent game studios

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Strategic Capital Broadens the Funding Stack

Corporate investors remained central to later-stage AI rounds and strategic technology scaling
German megadeals combined sovereign, industrial and global growth capital across defence, robotics and autonomy
EnBW New Ventures reinforced evergreen, founder-first corporate venture principles after a decade of investing
Strategic investors Google and RWE joined Proxima Fusion's latest financing alongside financial investors
B Capital and CalPERS targeted AI-enabled asset management through the acquisition of Russell Investments

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Frontier Technologies Attract Large-Scale Capital

Proxima Fusion raised €411 million to advance a European commercial fusion pathway
Oratomic secured a reported $300 million Series A for utility-scale fault-tolerant quantum computing
Axle Energy raised $25 million to scale grid flexibility across batteries, chargers and heat pumps
Arkenstone Defense raised $35 million, while Venus Aerospace secured $91 million for advanced propulsion
Lantern and Fuchs & Eule showed that supply-chain and data-enabled service models can also attract venture capital

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Venture Operations Become AI-Driven

Orange Collective deployed AI agents across sourcing, diligence, memo creation, search and portfolio tracking
Caplight raised $16 million to connect private-market data, fundraising and secondary-market liquidity
Data extraction emerged as the leading practical AI use case for venture investment teams
Poor data quality and limited implementation capacity remained larger constraints than software availability
Funds increasingly require embedded operating platforms and reusable portfolio-support capabilities

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Founder and Ecosystem Dynamics Continue to Evolve

Stacked SAFEs and pre-money option pools continued to create unexpected founder dilution
Recent software benchmarks indicated lower median dilution, although deal structures varied significantly by stage
Targeted LP and investor matching proved more valuable than high-volume outreach
Founders increasingly assessed investor reputation, follow-on behavior and downside support before accepting capital
Women-led funds showed reported outperformance despite controlling a marginal share of industry assets
The UK maintained its European funding lead, while MENA and Pakistan remained highly concentrated markets

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