This is a weekly feature that runs down the week鈥檚 top 10 announced funding rounds in the U.S. Check out last week鈥檚 biggest funding deal roundup here.

Startup investors kept up the busy dealmaking pace this week with a number of big rounds. Top among them was a $1.75 billion Series D for , developer of autonomous vessels. Other big funding recipients hailed from sectors including fitness wearables, energy tech, cybersecurity and AI infrastructure, among others.

1. , $1.75B, autonomous ships: Austin-based Saronic, a defense tech startup focused on autonomous sea vessels, raised $1.75 billion in Series D funding, bringing total funding to around $2.6 billion. led the round, which set a $9.25 billion valuation for the听 company, more than double its Series C level in 2025.

2. , $575M, fitness wearables: Whoop, a provider of wearable fitness technology and a subscription platform that tracks physiological data, secured $575 million in Series G funding. led the financing,which set a $10.1 billion valuation for the Boston-based company.

3. , $450M, nuclear energy: El Segundo, California-based nuclear energy startup Valar Atomics, raised fresh capital at a valuation of $2 billion, according to a citing unnamed sources. The financing reportedly included $340 million in equity funding and $110 million in debt.

4. , $300M, battery technology: EnerVenue, a developer of grid-scale energy storage technology, says it closed on a $300 million extension of its Series B preferred round led by . The Fremont, California-based company also appointed a new chief executive officer, Henning Rath.

5. , $250M, cybersecurity: Sarasota, Florida-based AI-enabled cybersecurity startup Tenex picked up $250 million in Series B funding led by . The company said it plans to use the funds to hire more than 250 people and supplying them with AI technology that makes them 鈥渢en times more efficient.鈥�

6. , $200M, micromobility: Also, an electric mobility company spun out of , raised $200 million in a Series C round 鈥媌acked by , , and . The Palo Alto, California-based startup鈥檚 product lineup includes bikes, small autonomous EVs for deliveries, and associated gear.

7. , $170M, space tech: Starcloud, a space infrastructure startup focused on building orbital data centers, secured $170 million in Series A funding led by and . The financing sets a $1.1 billion valuation for the Redmond, Washington-based company, making it the fastest alum to achieve unicorn status after demo day, which was 17 months ago.

8. , $130M, cloud infrastructure: New York-based cloud and AI infrastructure startup ScaleOps landed $130 million in Series C funding. led the financing, which set听 a valuation of over $800 million for the 4-year-old company.

9. , $100M, biotech: Boulder, Colorado-based Ambrosia Biosciences, a developer of next-generation oral therapeutics for obesity and related cardiometabolic diseases, picked up $100 million in Series B funding led by , and .

10. , $94M, money transfer: OpenFX, provider of a platform to move money across borders, secured $94 million in Series A funding from backers including , , , and .

Methodology

We tracked the largest announced rounds in the 附近上门 database that were raised by U.S.-based companies for the period of March 28-April 3. Although most announced rounds are represented in the database, there could be a small time lag as some rounds are reported late in the week.

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A total of 27 companies joined the 附近上门 last month, including six robotics companies and four semiconductor-related startups. Healthcare minted three new unicorns, while foundation AI, cloud services, aerospace and financial services each accounted for two companies that joined.

The U.S. once again dominated, with 19 companies joining the board. China tallied four new unicorns, the U.K. contributed two, and India and Germany each added one new unicorn.

Soaring valuations

Overall unicorn values soared in February as raised $110 billion at a value of $840 billion, making it the most highly valued private company of all time. Its closest rival, , raised $30 billion at a valuation of $380 billion, making it the fourth-largest valued company on the list. , the autonomous driving technology company, was valued at $126 billion, positioning it among the top 10 most highly valued private companies.

February鈥檚 new unicorns

Here are February鈥檚 newly minted unicorns.

Robotics

• , a solution for automating building equipment for autonomous construction, raised a $270 million Series B led by and . The 1-year-old company, based in San Francisco, was valued at $1.8 billion.
• Beijing-based , a physical intelligence foundation model and humanoid robotics company, raised a $290 million Series A led by and . The 2-year-old company was valued at $1.5 billion.
• , a builder of intelligent robots for industrial and service industries, raised a $145 million Series B round. The 2-year-old Beijing-based company was valued at $1.4 billion.
• Humanoid robotics company raised a $145 million Series B led by . The 2-year-old China-based company was valued at $1.4 billion.
• , a testing and control software layer for aerospace, defense, robotics and industry, raised a $150 million Series B led by . The 1-year-old Los Angeles-based company was valued at $1 billion.
• , a company that transforms 5G and Wi-Fi into spatial awareness for connective devices, an underlying layer necessary for physical AI, raised a $100 million Series B from well-known investors , , , and . The 9-year-old Belmont, California-based company was valued at $1 billion.

Semiconductor

• China-based , developer of a chip for advanced autonomous driving, raised a $330 million Series A led by and . The company, which is less than a year old and spun out of automaker , was valued at $1.5 billion.
• London-based , a photonic chip company for more efficient AI inference, raised a $220 million Series A led by . The 2-year-old company, valued at $1 billion, has plans to ship its first product in 2027.
• Reno, Nevada-based , builder of memory chips for AI, raised a $230 million Series B led by , and . The 3-year-old company was valued at $1 billion.
• , a chip developer for AI training, raised a $500 million Series B led by and . The 3-year-old company, based in Mountain View, California, was valued at $1 billion. It plans to ship its first product in 2027.

Healthcare

• New York-based , a platform that helps employers and employees source the best doctors with improved costs, raised a $118 million Series D led by . The 7-year-old company was valued at $1.4 billion.
• Palo Alto, California-based , a women’s telehealth provider, raised a $100 million Series D led by . The 4-year-old company was valued at $1 billion.
• , a Redwood City, California-based digital platform that helps medicare customers connect with advocates to navigate healthcare, raised a $130 million Series C led by . The 4-year-old company was valued at $1 billion.

Cloud services

• , a cloud platform for application development teams, raised a $100 million Series C led by . The 8-year-old San Francisco-based company was valued at $1.5 billion.
• Mumbai-based , a cloud service GPU provider, raised a $600 million round led by . The 3-year-old company was valued at $1.4 billion.

Foundational AI

• , builder of an AI model to analyze large databases, raised a $225 million Series A led by . The company also says it has signed a partnership agreement with ‘s to offer the model to its customers. The 2-year-old, San Francisco-based company was valued at $1.4 billion.
• , a model developer to debug and understand AI, raised a $150 million Series B led by . The 1-year-old San Francisco-based company was valued at $1.3 billion.

Aerospace

• , a space-based communications infrastructure player to support commercial satellite and government missions, raised a $100 million Series B led by and. The 4-year-old Livermore, California-based company was valued at $1.3 billion.
• , an aviation hardware and software company for automated flights, raised a $300 million Series C led by and . The 10-year-old El Segundo, California-based company was valued at $1.2 billion.

Financial services

• London-based , a U.K.-based digital bank for small and medium-sized businesses, raised a $155 million Series D led by , and . The 8-year-old company was valued at $1.2 billion.
• , an agentic platform for accountants, raised a $100 million Series B led by , and . The 3-year-old company, based in New York, was valued at $1.2 billion.

E-commerce

• Brooklyn-based , a marketplace for creators to sell digital products, raised a $200 million round led by . The 5-year-old company was valued at $1.6 billion.

Coding

• , a Boston-based code translation service for legacy code, raised a $125 million Series B led by 1. The round valued the 2-year-old company at $1.3 billion.

Defense

• Berlin-based , a developer of strike drones and autonomous defense systems, raised an undisclosed sum in a round led by that valued the 1-year-old company at $1.2 billion.

Forecasting

• Boston-based , an AI-native weather satellite constellation, raised a $175 million Series F led by and . The 9-year-old company was valued at $1 billion.

Sales & marketing

• New York-based , a brand marketing platform geared for AI search, raised a $96 million Series C led by that valued the 1-year-old company at $1 billion.

Web3

• , a blockchain intelligence platform to detect crime networks, raised a $70 million Series C led by . The raise valued the 8-year-old company, based in San Francisco, at $1 billion.

Related 附近上门 unicorn lists:

• (1,703)
• (604)
• (65)
• (187)
• (115)
• (102)
• (878)
• (500)
• (228)
• (38)
• (471)

Related reading:

• Massive AI Deals Drive $189B Startup Funding Record In February While Public Software Stocks Reel
• 附近上门 Data: The AI Boom Has Drastically Changed Who鈥檚 Funding The Hottest Companies In 2025 Vs. 2021
• January Delivers Highest New Unicorn Count In More Than 3 Years

Methodology

The 附近上门 附近上门 is a curated list that includes private unicorn companies with post-money valuations of $1 billion or more and is based on 附近上门 data. New companies are as they reach the $1 billion valuation mark as part of a funding round.

The unicorn board does not reflect internal company valuations 鈥� such as those set via a 409a process for employee stock options 鈥� as these differ from, and are more likely to be lower than, a priced funding round. We also do not adjust valuations based on investor writedowns, which change quarterly, as different investors will not value the same company consistently within the same quarter.

Funding to unicorn companies includes all private financings to companies that are tagged as unicorns, as well as those that have since graduated to .

Exits analyzed here only include the first time a company exits.

Please note that all funding values are given in U.S. dollars unless otherwise noted. 附近上门 converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to 附近上门 long after the event was announced, foreign currency transactions are converted at the historic spot price.

Illustration:

This is a weekly feature that runs down the week鈥檚 top 10 announced funding rounds in the U.S. Check out last week鈥檚 biggest funding deal roundup here.

This week鈥檚 largest U.S. funding rounds once again featured an AI-heavy cohort, along with sizable financings around fintech and energy tech. By far the largest deal was a $1 billion financing for , developer of AI models that interact with the 3D world, followed by a $385 million round for savings platform .

1. , $1B, spatial AI: San Francisco-based World Labs, a startup founded by AI pioneer that develops foundational models to generate and interact with the 3D world, raised $1 billion in fresh funding. Investors in the round include , , , , and .

2. , $385M, fintech: Vestwell, an online provider of multiple types of savings accounts and tools, raised $385 million in Series E funding at a reported $2 billion valuation. and led the financing for the 10-year-old, New York-based company.

3. , $300M, workflow management and fault tolerance: Bellevue, Washington-based Temporal Technologies, a provider of tools that allow developers to make workflows more reliable and fault-tolerant, closed on $300 million in Series D funding. led the financing, which set a $5 billion valuation for the 7-year-old company.

4. , $140M, energy tech: Heron Power, a developer of hardware designed to move electricity from renewable sources into the grid and data centers, picked up $140 million in a funding round backed by and . The Scotts Valley, California-based company is founded by former SVP .

5. , $125M, AI coding: Code Metal, a provider of verifiable code translation tools, raised $125 million in Series B financing led by 1. The round comes just three months after the Boston-based startup secured its Series A.

6. (tied) , $100M, cloud for developers: Render, a cloud provider for application development teams, secured $100 million in Series C extension funding. led the financing for the San Francisco-based company, which said it now has over 4.5 million developers on its platform.

6. (tied) , $100M, clean energy: Houston-based Utility Global, developer of a technology to produce hydrogen and capturable carbon from industrial gases, raised $100 million in Series D funding. and led the financing for the 8-year-old company.

6. (tied) , $100M, location tracking: ZaiNar, developer of a technology for wireless networks to sense the location of things without satellites, cameras or heavy compute power, emerged from stealth and disclosed that it has drawn over $100 million in investment to date and a valuation of over $1 billion. Backers in the Belmont, California-based company include , , and .

9. , $80M, fintech: Salt Lake City-based Jump, developer of an AI agent for financial advisers and financial services providers, raised $80 million in a Series B round led by .

10. , $80M, AI observability: San Francisco-based Braintrust, a developer of AI observability software for development teams, raised $80 million in a Series B round led by .

Methodology

We tracked the largest announced rounds in the 附近上门 database that were raised by U.S.-based companies for the period of Feb. 14-20. Although most announced rounds are represented in the database, there could be a small time lag as some rounds are reported late in the week.

Illustration:

Now in the third quarter, it appears that Brazil is back on top 鈥� and in a big way. Brazil-based startups raised $692 million in Q3, up 47% year over year and 92% quarter over quarter. Mexico-headquartered startups brought in $126 million, down 21% year over year and a 71% dip quarter over quarter.

The largest raise in Brazil 鈥� and Latin America as a whole 鈥斕齱as announced on Sept. 11. That was a round for Sao Paulo-based 鈥� which offers cloud-based management software for SMEs 鈥�- that valued the company at $700 million. led the financing.

In general, a boom in late-stage and growth funding helped buoy the region year over year, 附近上门 data shows. Overall, startups in Latin America raised a combined $1 billion across seed- through growth-stage deals in the third quarter, up 21% year over year and up 8% from the second quarter.

Of that total, $477 million went into late-stage and growth deals, up 176% year over year. That鈥檚 down 16%, however, from the $565 million in late-stage and growth financing the region saw in the second quarter of this year.

Early-stage investment surged in the third quarter with $425 million flowing into startups, up 18% year over year and 48% compared to the second quarter.

Seed and angel investment totaled $105 million for the third quarter, which marked a 34% increase compared to the prior quarter, but a 47% decrease year over year.

For perspective, we charted out total investment, color-coded by stage, for the past 10 quarters below.

Table of contents

• Late-stage boom
• Investor POV
• The rise of stablecoins
• Methodology
• Glossary of funding terms

Late-stage boom

While Omie鈥檚 venture round was the largest financing in Latin America, it was not the only nine-figure raise the region saw in Q3.

Other large deals included , a Mexico City-based -backed digital bank, raising a $100 million Series C that propelled its valuation to over $1.3 billion. and led that financing.

raised $100 million in a round co-led by and . Founded in 2025, the Sao Paulo-based startup is a tech holding company that aims to acquire and scale B2B software providers.

Investor POV

, head of Brazil at , said the quality of the companies getting funded in Latin America as of late seems 鈥渉igh鈥� and 鈥渓ike a step up from earlier in the year.鈥�

鈥淲e saw big rounds, a solid shift to AI taking over, and lots of activity in fintech both in terms of deals and market events,鈥� she told 附近上门 News.

鈥淭he AI hype felt like it was a wave behind the U.S. for a bit,鈥� she said, 鈥渂ut now we are seeing application layer solutions getting funded in addition to companies leaning heavily into AI-enhanced strategies.鈥�

Fraud prevention and security are taking center stage on the backs of major breaches in Brazil. Vieira cited research revealing that in 2024, Brazil鈥檚 financial sector R$10.1 billion ($1.88 billion in USD) in losses related to fraud.

鈥淭his is already increasing the regulatory thresholds in Brazil and is likely to put more scrutiny in fintech,鈥� she said.

Mexico was not excluded from the drama as a number of banks dealt with issues 鈥斕� potentially delaying or postponing activity to push fintech forward, Vieira noted.

鈥淥n the positive side, Colombia gave clarity around open banking and launched Bre-B, the country’s real-time payment network,鈥� she added.

, partner at , said her firm has long tracked the rise of , or alts, as they 鈥渂ecome a core piece of the modern investment portfolio,鈥� and amid the subsequent rise of infrastructure players enabling their expansion.

Within 鈥渁lts,鈥� private credit has been one of the fastest-growing and most overlooked segments, she noted.

That led to F-Prime leading the round into , a platform that offers tech-driven back-office services for alternative investments, to 鈥渟pearhead Brazil鈥檚 private credit infrastructure development.鈥� Over the past 12 months alone, she said, the company grew 150%, with customers spanning Brazil鈥檚 largest banks, investment managers, private credit funds and originators.

Overall, , principal and head of LatAm investments at , believes that Latin American founders generally 鈥渁re rewriting the rules of financial innovation.鈥�

鈥淔intech remains the region鈥檚 No. 1 funded sector because trust, access and agency are still the biggest pain points for consumers and businesses,鈥� she told 附近上门 News. 鈥淚n LatAm, entrepreneurs innovate under tighter capital and tougher consumer realities, producing solutions that are not just resilient but transformative. This is not a story of catching up, it鈥檚 a story of leapfrogging.鈥�

Recent LatAm investments for the firm include co-leading rounds for: , which aims to modernize payment acquiring in LatAm, and , a Sao Paulo-based platform that integrates financial management software, a native bank account and corporate card for midsized businesses in Brazil. It also wrote a check into a $2.1 million round for , also based in Sao Paulo, which is building real estate credit infrastructure.

The rise of stablecoins

Vieira believes that 鈥渆veryone continues to watch stablecoins, trade and other cross-border activity as a big opportunity for Latin America.鈥�

A is a type of digital currency designed to maintain a stable value.

Wu is also excited about the potential for stablecoins in the region.

鈥淲e have increasingly high conviction that stablecoins are the killer use case for crypto, and cross-border payments are an ideal use case because they offer material benefits over current rails 鈥� faster, cheaper and more transparent 鈥� in a massive market,鈥� she said.

In addition, with upcoming regulatory clarity in Brazil, the local denominated stablecoin is on the rise, 鈥渨ith the promise of yield-bearing stablecoins and tokenization of real-world assets,鈥� Wu noted.

鈥淥verall, the stablecoin market in LatAm has numerous nascent players with liquidity fragmentation, and we look forward to seeing more interoperability and consolidation,鈥� she said.

Methodology

The data contained in this report comes directly from 附近上门, and is based on reported data. Data is as of Oct. 6, 2025.

Note that data lags are most pronounced at the earliest stages of venture activity, with seed funding amounts increasing significantly after the end of a quarter/year.

Please note that all funding values are given in U.S. dollars unless otherwise noted.

附近上门 converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to 附近上门 long after the event was announced, foreign currency transactions are converted at the historic spot price.

Glossary of funding terms

Seed and angel consists of seed, pre-seed and angel rounds. 附近上门 also includes venture rounds of unknown series, equity crowdfunding and convertible notes at $3 million (USD or as-converted USD equivalent) or less.

Early-stage consists of Series A and Series B rounds, as well as other round types. 附近上门 includes venture rounds of unknown series, corporate venture and other rounds above $3 million, and those less than or equal to $15 million.

Late-stage consists of Series C, Series D, Series E and later-lettered venture rounds following the 鈥淪eries [Letter]鈥� naming convention. Also included are venture rounds of unknown series, corporate venture and other rounds above $15 million. Corporate rounds are only included if a company has raised an equity funding at seed through a venture series funding round.

Technology growth is a private-equity round raised by a company that has previously raised a 鈥渧enture鈥� round. (So basically, any round from the previously defined stages.)

Illustration:

While late-stage startup investment in Europe remains relatively muted, early-stage funding has quietly become Europe鈥檚 engine of resilience 鈥� helping sustain overall funding levels even as global capital continues to concentrate around massive AI rounds in the U.S., 附近上门 data shows.

All told, European startups pulled in $13.1 billion across more than 1,000 deals last quarter, flat quarter over quarter but up 22% year over year, per 附近上门 data. Early-stage investment accounted for roughly 60% of that total, buoyed by strong activity in deep tech, biotech and AI applications.

This contrasts with North America, which has seen a surge of megarounds of $500 million or more, largely into AI-related companies, over the past four quarters. North American companies raised 68% of global funding in Q3, up 10 percentage points from a year ago, with two-thirds invested in later-stage financings.

Table of contents

• Klarna debuts and strong M&A
• AI stepped up
• Late stage
• Early stage up
• Seed
• Robust early stage
• Methodology
• Glossary of funding terms

Klarna debuts and strong M&A

Sweden-based Klarna went public on the in Q3 at a value of $15.1 billion, marking the completion of one of the most-anticipated European debuts in recent years. Still, while Klarna鈥檚 listing price was well above its most recent private valuation at $6.7 billion in 2022, it was still far below its 2021 valuation of $45.5 billion.

Five European companies were also acquired for close to or more than a billion dollars each last quarter, including Sweden-based enterprise knowledge platform , which was purchased by , and Germany-based conversational AI platform , acquired by . Other billion-dollar startup exits out of Europe last quarter were in healthcare 鈥� and 鈥� and , in asset management.

AI stepped up

Close to 40% of European funding was invested in AI-related startups last quarter, totaling $5.2 billion, per 附近上门 data. That was up from $2 billion in Q3 2024.

The large fundraisers in the space were Paris-based frontier model company , which raised $2 billion, and London-based , a 1-year-old data center and cloud provider that raised $1.1 billion. (Within a week in early October, Nscale raised another $433 million from , and , among others.)

Other large rounds in AI last quarter were raised by Sweden-based vibe coding startup , London-based accounts payable company , and Switzerland drone and robotics operations platform .

Late stage

Around $5.4 billion was invested last quarter across 75 deals into Europe startups at growth stage, per 附近上门 data. That represents around 9% of global late-stage venture funding, the smallest proportion compared to other funding stages. The

Other late-stage fundings went to London-based smartphone and device maker , Netherlands-based website design , and Italy-based embedded device security platform .

Early stage up

Early-stage funding in Q3 was up year over year by 31%, with $6.1 billion invested across more than 257 funding rounds. European funding represented 20% of global early-stage funding.

Early-stage rounds also went to Finland-based , Belgium-based , and U.K.-based material science company .

Seed

European seed funding totaled $1.7 billion in Q3 across 745 seed rounds, representing 18% of global seed funding.

Large seed rounds were raised in energy, AI, biotech, fintech, autonomous driving and robotics, among other sectors.

Robust early stage

Early-stage funding to European startups picked up in Q3 with large rounds in deeptech, biotech and AI applications across many European cities.

Europe鈥檚 early-stage funding represents around 20% of global venture funding, while funding lags at the later stages, coming in at 9% of global funding.

So while Europe’s startups haven’t produced the splashy growth figures of their North American counterparts, the region has now delivered several sequential quarters of steady funding, not to mention resilient early-stage investment and strong exits in Q3. In fact, four of the nine companies acquired globally for more than $1 billion last quarter hail from Europe. As Europe and the U.S. come closer together, with many European founders launching in the U.S. market earlier, the question is: Will Europe continue to create those standout $10 billion-plus companies as it did most recently with Klarna?

Methodology

The data contained in this report comes directly from 附近上门, and is based on reported data. Data is as of Oct. 6, 2025.

Note that data lags are most pronounced at the earliest stages of venture activity, with seed funding amounts increasing significantly after the end of a quarter/year.

Please note that all funding values are given in U.S. dollars unless otherwise noted. 附近上门 converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to 附近上门 long after the event was announced, foreign currency transactions are converted at the historic spot price.

Glossary of funding terms

Seed and angel consists of seed, pre-seed and angel rounds. 附近上门 also includes venture rounds of unknown series, equity crowdfunding and convertible notes at $3 million (USD or as-converted USD equivalent) or less.

Early-stage consists of Series A and Series B rounds, as well as other round types. 附近上门 includes venture rounds of unknown series, corporate venture and other rounds above $3 million, and those less than or equal to $15 million.

Late-stage consists of Series C, Series D, Series E and later-lettered venture rounds following the 鈥淪eries [Letter]鈥� naming convention. Also included are venture rounds of unknown series, corporate venture and other rounds above $15 million. Corporate rounds are only included if a company has raised an equity funding at seed through a venture series funding round.

Technology growth is a private-equity round raised by a company that has previously raised a 鈥渧enture鈥� round. (So basically, any round from the previously defined stages.)

Illustration:

The Sunnyvale, California-based company announced on Sept. 30 a Series G funding round that valued it at $8.1 billion post-money. and led the financing.

Then on Oct. 3, the startup submitted to the , formally requesting to withdraw its IPO registration because it 鈥渄oes not intend to conduct the proposed offering 鈥� at this time.鈥�

Cerebras originally filed to go public in September of 2024. At that time, the company was 鈥渞amping up to take on in an effort to create processors for running generative AI models,鈥� .

In its filing, Cerebras noted its dependence on a single customer, Group 42, a subsidiary of its investor , responsible for more than 80% of revenue in 2023 and the first half of 2024.

Cerebras has built a larger chip that is 10x faster for AI training and inference compared to leading GPU solutions, according to the . Its customers include and the .

The company has reportedly shifted its focus since that initial filing from selling systems toward more of being a cloud service provider for accepting incoming queries to models that use its chips underneath, according to . CEO told the publication that he thought last year鈥檚 prospectus was 鈥渙ut of date鈥� considering developments in AI.

Cerebras has raised a known $1.8 billion in funding since its 2016 founding by Feldman, per 附近上门 . It raised $250 million in led by in November 2021 that valued the company at just over $4 billion. Other backers include , , , and .

Related 附近上门 queries:

Illustration:

The company had grown the top line, but not the margin. It was scaling itself out of business.

This kind of story is becoming more common as we move into the AI era. The old SaaS playbook of build a great app, charge monthly and let infrastructure fade into the background, doesn鈥檛 hold up when your core cost scales with usage.

AI has reshuffled the value chain, and for startups, this shift is existential.

The AI stack is deep and margin has moved

In traditional SaaS, most of the value was captured at the application layer. Today, AI companies operate in a much deeper stack:

1. Energy infrastructure: Data centers, cooling and power (see 鈥檚 $10 billion investment in data center energy in Virginia);
2. Chips and hardware: 鈥檚 H100s, TPUs, scarce and expensive;
3. Cloud platforms: Azure, , with priority GPU access;
4. Models: OpenAI, Anthropic and increasingly open-source players;
5. Vertical AI solutions: Can be used as low code/no code platforms to build specific AI applications; and
6. Applications: The user-facing product, where most AI startups still live.

But unlike the past, margins no longer concentrate at the top, close to the end user. They now often sit below the surface, especially in layers where scarcity exists such as hardware, compute and exclusive model access.

So what can startups do when they don鈥檛 own the infrastructure or the models?

Three moves founders can make to stay in the game

1. Own your data. It鈥檚 your new moat

You don鈥檛 need to train your own foundation model, but you do need to own the inputs that make your product valuable.

If you’re in a vertical such as healthcare, finance, real estate or legal, your advantage is proprietary, structured data. Fine-tune open models. Build lightweight adapters. Use your customer workflows to continuously collect differentiated data. The value is in the dataset.

2. Price for usage, not access

That founder’s $800,000 cloud bill happened because they were charging like a SaaS company but operating like a compute company.

In AI, usage drives cost. That means flat-rate subscriptions don鈥檛 work. Founders must embrace pricing models that align value delivered with cost incurred:

• Per-output or per-token billing;
• Compute-aware pricing tiers; and
• Charging for high-cost features such as image generation or live inference.

Track gross margin by feature, not just customer.

3. Avoid model lock-in. Design for flexibility

Tying your roadmap to one model provider like OpenAI or Anthropic is risky. Latency, pricing and policy changes can all blindside you.

Instead, build with model abstraction in mind. Route across providers, fine-tune open-source backups, and negotiate contracts with leverage. Flexibility is not just technical. It is a business hedge.

听 is a strategic adviser to tech companies and investors, specializing in strategy, growth and M&A, a guest contributor to 附近上门 News, and a seasoned lecturer. Learn more about his advisory services, lectures and courses at . for further insights and discussions.

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The Santa Clara, California-based company priced shares at $19 each late Wednesday, the top of the projected range. The offering brought in $908 million for Netskope, which is trading on under the symbol NTSK.

Founded in 2012, Netskope was formed with a vision to build security tools optimized for the cloud computing era. It鈥檚 honed its offerings over the years as new technologies, in particular those enabled by AI, have added fresh online risks for enterprises to face.

Per 附近上门 , Netskope has been a prodigious venture fundraiser over the years, pulling in $1.4 billion in early- through late-stage financing. Its largest venture stakeholders are and , each with around 19% of Class B shares, followed by , with 9%.

Today, Netskope generates substantially all of its revenue from the sale of cloud subscriptions to its Netskope One platform. The company says it generally prices subscriptions based on the scale of a customer’s organization and the products it deploys, usually with a contract term of one to three years.

In recent quarters, Netskope has posted significant and growing revenue, along with large yet shrinking losses.

For the first six months of this year, revenue totaled $328 million, up 31% year over year. Concurrently, Netskope posted a $170 million net loss for the first half of 2025, down from $207 million in the year-earlier period.

The company鈥檚 market debut follows a relatively bullish period for cybersecurity startup dealmaking. Per 附近上门 data, cybersecurity was a hot area for venture investment in the first half of 2025, with total funding to the space hitting its highest level in three years.

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Investors in the round include and , joined by existing backers , and .The new financing brings total funding to date for the 10-year-old company to .

The fundraise comes amid a comparatively upbeat period for cybersecurity funding. So far this year, investors have poured just over $7 billion into global startups in the space, .

Investment rose sequentially in Q1 of this year, as well as Q2, which winds to a close today. Besides Cato, other mega-round recipients include AI-powered data security platform , which raised $540 million earlier this month, and endpoint security provider , which landed $500 million in February.

Cato is focused on SASE, or secure access service edge, a networking and security category that provides a single cloud-based network to connect and secure physical, cloud or mobile enterprise resources.

Among the touted benefits of SASE is that it helps enable secure remote work. That鈥檚 been a high-demand capability given that enterprises today rely heavily on remote and hybrid workforces. And with the exception of some high-profile return-to-office mandates, that鈥檚 not likely to change in the foreseeable future.

Looking forward, Cato said it plans to use the latest funding to expand capabilities enabling customers to securely adopt AI, increase its R&D spending, and grow its global footprint.

The financing also comes amid a growth period for 鈥渦ltra-unicorns,鈥� or private companies valued at $5 billion or more. Per 附近上门 data, at least 17 companies joined this cohort in just the first half of 2025 鈥� including high-profile players such as , and . While Cato hasn鈥檛 quite crossed the $5 billion threshold 鈥� it鈥檚 really, really close.

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And while usually this involves a sale to a strategic buyer, the next-likeliest suitor is probably a private equity firm.

Over the past five years, private equity firms have spent more than $56 billion in disclosed-price acquisitions of private, venture-backed companies, per . Since less than a fifth of purchases come with a reported price, total deal value is undoubtedly much higher.

So far this year we aren鈥檛 seeing signs of a slowdown. PE firms have announced 22 acquisitions of seed- or venture-funded private companies. The lineup includes three deals with disclosed pricetags totaling $8.3 billion.
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For a sense of how that compares to previous periods, we charted the annual deal counts and values since 2020 below.

Large recent deals

For 2025, it helps that the deal total includes the biggest reported purchase price in more than five years. That would be healthcare software platform 鈥檚 March sale of a majority stake to at a reported value of $5.3 billion.

Founded in 2010, ModMed isn鈥檛 exactly a startup. However, it had raised more than $385 million in funding over the years, including multiple venture rounds and an investment from PE firm . Of late, the Boca Raton, Florida-based company has been focused on applying AI to automate its offerings for medical practices.

The second-largest deal 鈥� 鈥檚 April to for a reported $2.6 billion 鈥� is another example featuring a health software player that has aged out of the startup label. Founded in 2004, the Massachusetts-based provider of software for health plans raised about $98 million in venture funding before selling to in 2020.

Startup exits

Private equity firms tend to buy companies with established businesses and sizable, growing revenue. As a result, startups they acquire tend to be on the later-stage, more mature end of the spectrum.

This is evidenced by some of the other large PE acquisitions of the past year. This includes auditing automation platform , founded in 2014 and acquired by last spring for $3 billion, and , a cloud storage provider founded in 2009 that sold to in July for $1.2 billion.

On the other hand, if you鈥檙e a seed-stage company launched in the past couple years, private equity probably won鈥檛 be your near-term exit strategy. It鈥檚 far more likely to sell to a company in the same industry that鈥檚 interested in the technology and willing to overlook the lack of a predictable revenue stream.

PE valuations take a beating, but deals still get done

Looking forward, there are cases to be made both for and against the probability of a near-term pickup in PE acquisitions of venture-backed companies.

On the negative side, shares of the big, publicly traded PE firms have taken a beating in recent months. , , and , for instance, are all down roughly a third from the highs reached late last year and early this year. That indicates increased investor pessimism about their ability to make money through buying and scaling businesses.

On the positive side, however, there鈥檚 certainly a bountiful supply of later-stage companies available for acquiring. Per , there are currently 789 private, venture-backed companies in the U.S. that met or exceeded the $1 billion threshold at their last reported valuation.

Of those, many raised their biggest rounds around the market peak roughly four years ago. Since then, valuations have come down for many outside ultra-hot sectors like generative AI. At this point, a large cross section are pretty mature companies at this point, which听 might make them well-suited for a private equity acquirer.

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