Family offices are cutting out VC middlemen to invest directly in AI startups, driving an early-stage investment boom before companies go public.
Austin, Texas: Family offices are buying stock in AI startups before companies go public.
For many years, normal people could not buy stock in hot new companies. Only big investment groups called venture capitalists got to do that. Now wealthy families want to get in earlier.
Arena is one company doing this. They recently gave $230 million to Positron, which makes AI chips. Arena now has a seat on Positron’s board of directors. This means they help make big decisions for the company.
The timing is important. Stein from Arena said “The world’s AI infrastructure is being built now” He thinks families who wait too long will miss their chance. Schottenstein from Arena said “Your biggest risk is not having exposure to AI”
Numbers show this trend is real. In February, family offices made 41 direct investments in startups. Nearly all were tied to AI. Famous names like Laurene Powell Jobs and Eric Schmidt are doing this too.
Some families are doing even more. They are starting their own AI companies from scratch. Jeff Bezos is running his own robotics company now. Tyson Tuttle, who used to run Silicon Labs, started Circuit using AI for manufacturing.
Arena is careful about who they invest in. They work with experts to check if technology really works. They look at who else is investing. If big companies like Arm invest, that tells Arena the technology is good.
Arena only makes a few deals each year. When they invest, they put everything into one company. They take big risks but also big chances for rewards. This makes founders want to work with them.