AI’s IPO boom is creating venture capital’s biggest winners

Venture capital’s biggest winners are changing the rules of the exit game, and 2026’s IPO boom is allowing them to cash in. US IPOs have reportedly already raised more than $141.2 billion this year. This puts the market within striking distance of the $142.4 billion record set in 2021. The biggest artificial intelligence listings are still expected to come.

For private equity firms investing in these firms, the time is virtually perfect. However, this might not be the case for long. Brookfield-backed data center operator Csquare is looking to raise up to $1.35 billion under its IPO scheduled for July 15, which may push the fundraising this year to a level never seen before. Nuclear startup Standard Nuclear is also aiming for its debut on that day and is trying to raise the amount of $384.3 million.

Widening the gap with the AI elite

There are even greater names ready to enter the scene. Stelios Saffos, partner at Latham & Watkins, told Axios that the recent boom of large offerings has been “as much of a green light as you could possibly get.” According to him, the investors jumped into these deals partially due to their beliefs that such companies as Anthropic and OpenAI will follow suit.

That momentum contributes to widening the gap between the select few elite venture firms and the rest of the sector. Reuters reported that the major gains made by AI leaders such as SpaceX, OpenAI, and Anthropic are distributed among a limited number of investors who have funded them in the early stages. Meanwhile, many traditional venture firms struggle to obtain their next funding rounds.

This level of concentration alters the power dynamics. Once most venture capital funds get invested into a handful of big investment deals, the companies that take part in them obtain more power in determining company valuations, seats on the Board, and exit points, while smaller investors benefit less from controlling any processes.

AI IPO growth will benefit only a few

The National Venture Capital Association maintains that venture capital investing still brings about important economic benefits.

Venture investing generates billions of dollars for investors, their institutions and creates millions of jobs. Many venture-backed companies have scaled, gone public, and become household names, and at the same time have generated high-skilled jobs and trillions of dollars of benefit for the U.S. economy.

It states that jobs at VC-supported companies increased by 960% between 1990 and 2020 compared to 40% in the overall economy and estimates that three-quarters of the largest venture capital-funded companies would not have grown to that extent had they not received venture financing. However, at this point one question becomes practically impossible to evade: how much of the current AI-driven growth is going to benefit companies that are not in the top rankings?

Still, the rally is fraught with dangers. As Axios pointed out, there’s growing interconnectedness to AI investment. The same hype that has reignited the IPO market can just as quickly reverse if investor mood soured.

A case in point: Tim Draper is a third-generation Silicon Valley venture capitalist and founder of Draper Fisher Jurvetson, Draper University and Draper Associates. A Stanford University electrical-engineering graduate with an MBA from Harvard Business School, he founded Draper Associates in 1985. He’s since been a backer of more than 60 “unicorns” at the seed stage, including Tesla, SpaceX, Twitch, Coinbase Global, Robinhood and Baidu. He weighs in on the AI bubble and four huge opportunities he missed.

In a recent interview, Draper shares how he identifies ideas that seem impossible, where he sees the next wave of AI opportunity, whether AI stocks are in a bubble and why he refuses to make a bear case — for anything. He compared AI’s current trajectory to the early internet era. His notable remark: “I invest in heroes.”

Is there a new order in the venture capital sector?

Other areas still continue to face difficulty. The Financial Times states London has achieved its lowest amount of money raised from IPOs in the last 30 years, which means investment banks and advisers have to count more on private markets, while asking policymakers to make changes. The situation has created the greatest difference between regions: record fundraising in New York due to AI while listing markets are still stuck elsewhere.

The next significant trial will occur when OpenAI and Anthropic eventually enter the public market. Their IPOs will show if the venture capital companies that supported them from the beginning can turn years of unrealistic profits into actual gains and solidify a new order in the venture capital sector.