Venture Capital Intelligence Report
February 13, 2026 • Synthesizing insights from top-tier VCs
VCs see a maturing AI cycle with infrastructure winners emerging while application layer faces commoditization pressure. Flight to quality continues as public tech multiples compress.
Series A crunch persists with 60% fewer deals at Series A, but AI infrastructure and vertical SaaS continue attracting capital. Seed funding normalizing but requires stronger product-market fit signals.
Down-rounds at growth stage (40% of Series C+), seed/A valuations stabilizing at 2021 levels. Revenue multiples compressed from 15-20x to 8-12x for SaaS, but AI infra still commanding premiums.
NVIDIA dependency creates massive opportunity for specialized inference chips, model optimization, and distributed training infrastructure. Market demands 10x cost reduction.
Generic LLMs hitting performance ceiling; specialized agents for specific workflows showing 10x better task completion rates. Vertical expertise becomes the moat.
IRA funding catalyzing domestic manufacturing renaissance. Battery tech, solar, and carbon capture hitting commercialization inflection point.
AI adoption creating new attack vectors while enabling sophisticated defense. Organizations need AI-native security from day one.
First-gen fintech infrastructure (Stripe, Plaid) mature; next wave focuses on embedded finance, crypto rails, and global payment orchestration.
As foundation models commoditize, defensible value accrues to specialized infrastructure that enables model deployment, optimization, and governance at enterprise scale
AI agents will replace traditional SaaS workflows, creating opportunity for vertical-specific agent platforms that understand domain expertise
EU AI Act creates opportunity for European startups to build compliance-first AI solutions that can expand globally
IRA funding combined with supply chain resilience needs creating unprecedented opportunity for climate tech manufacturing in US
Infrastructure and tooling for managing, monitoring, and securing AI models in production environments
Enterprise AI adoption hitting compliance requirements, model drift becoming expensive problem, regulatory pressure increasing
$50B+ market as every AI deployment needs governance layer
Early signals from: Scale Venture Partners, Accel, Greylock
Companies to watch: Weights & Biases, Arthur AI, Fiddler
AR/VR applications focused on industrial training, remote collaboration, and 3D data visualization
Apple Vision Pro validating spatial computing UX, remote work permanence, aging industrial workforce needing knowledge transfer
$30B+ market in industrial and enterprise applications
Early signals from: Benchmark, General Catalyst, Lightspeed
Companies to watch: Magic Leap, Varjo, Immersed
AI-designed proteins for therapeutics, materials, and industrial applications
AlphaFold breakthroughs enabling practical applications, manufacturing costs dropping, sustainability pressures
$100B+ market across pharmaceuticals, materials, agriculture
Early signals from: Andreessen Horowitz Bio Fund, GV, 8VC
Companies to watch: Generate Biomedicines, Arzeda, Ginkgo Bioworks
Previous: Red hot 2020-2022 with multiple unicorns → Now: Significant cooling, limited new funding
User acquisition costs skyrocketed, iOS privacy changes impacted growth, market saturated with existing platforms
What Changed: CAC payback periods extended beyond 24 months, TikTok dominance limiting new entrant success
VCs Cautious: Benchmark, Greylock, General Catalyst
Previous: Consistent VC favorite through 2021 → Now: Requiring differentiation beyond workflow automation
Market oversaturated, AI threatening to automate many SaaS categories, compression in SMB spending
What Changed: AI copilots reducing need for specialized tools, enterprises consolidating vendor relationships
VCs Cautious: Bessemer, Accel, Index
Previous: Billions invested 2021-2022 → Now: Struggling with user adoption and token economics
Play-to-earn models unsustainable, limited mainstream appeal, regulatory uncertainty around tokens
What Changed: User retention below traditional gaming, token price volatility hurting gameplay
VCs Cautious: a16z crypto, Paradigm, Haun Ventures
Focus on fine-tuning smaller models for specific tasks rather than using frontier models for everything - cost and latency benefits are massive
💡 Audit every AI feature for whether it actually needs GPT-4 level capabilities; most don't
— Benchmark Capital
IT buyers now require AI governance and security documentation from day one - build compliance into product architecture
💡 Create compliance documentation templates and security attestations as competitive differentiator
— Bessemer Venture Partners
Revenue quality matters more than growth rate - demonstrate path to profitability and strong unit economics even at early stage
💡 Include cohort retention, payback periods, and gross margin details in every pitch deck
— Sequoia Capital
AI engineers are becoming commoditized; focus on hiring domain experts who can work with AI tools rather than pure ML researchers
💡 Hire senior professionals from your target industry who can learn to prompt engineer
— Greylock Partners
Deal volume down 40% YoY but average deal size up 25% as VCs concentrate capital in higher-conviction bets. AI companies raising at 3x revenue multiples vs 1.5x for traditional SaaS.
Series D • Lead: Google Ventures • Others: Spark Capital, Sound Ventures
Validates continued investment in frontier AI despite commoditization concerns; Google hedging against OpenAI
Foundation ModelsGrowth • Lead: T. Rowe Price • Others: Franklin Templeton, Fidelity
AI training/inference driving massive data processing demand; validates data infrastructure thesis
Data InfrastructureSeries I • Lead: Thrive Capital • Others: General Catalyst, GV
Down from previous valuation but signals fintech infrastructure still attracting growth capital
Fintech InfrastructureAcquisition • Key investors: Accel, CapitalG, Dragoneer
Automation platforms with AI integration commanding premium multiples; consolidation accelerating
IPO • Key investors: Greylock, Index Ventures, Kleiner Perkins
Design tools with AI features seeing strong public market reception; validates creative AI thesis
Open source AI will win over closed models
Most VCs betting on proprietary foundation model companies
Reasoning: Linux playbook will repeat - open source enables ecosystem innovation that proprietary can't match
Their Bet: Leading rounds in open source AI infrastructure companies like Hugging Face and Modal
European AI regulation creates competitive advantage, not handicap
US VCs see EU regulation as innovation tax
Reasoning: Enterprise buyers globally will prefer privacy-compliant AI solutions; regulatory compliance becomes feature
Their Bet: Doubling European AI investments, focusing on compliance-first companies