In 2006, I was in my mid-20s, had wound down my company and was doing a postdoctoral scholarship to pay my bills. I had been told that I should raise venture capital for my next startup. I googled “nanotechnology” and “venture capital,” and the first Google search result was Lux, based in NYC, founded by a couple guys my age, who had funded companies building next-gen lithography, batteries, displays, and longevity. I was FLOORED. This is at a time when SoLoMo, ad-tech, and “cloud” were all the rage. I didn’t know VCs existed in NYC, or below the age of 40. I reached out to Pete and Josh offering to help source and diligence asking for nothing but friendship/mentorship in return, as I didn’t even have an idea at the time, and they replied the same day inviting me to spend time with them. No other VC had given such a warm reply to my blind outreach. Being flat broke, I submitted papers to land speaking slots at conferences in NYC to be able to go out to see them, and the rest is history. 20 years in, I’ve had the fortune of working with talent and being part of the inception and success of amazing companies in fields investors were shunning or simply not paying attention to. I’ve learned so much from working closely with incredible people who have brought different perspectives to the firm. In 2006, deep tech felt lonely; today the talent is everywhere, but conviction still matters. It’s a privilege to be part of this next chapter with our fresh $1.5B fund to continue working with founders as they are ideating to pulling together to launching to growing to establishing generational companies accelerating our future with feats of science and engineering.

Better returns for less risk?

Monthly VC/LP debrief. What I actually saw in May 2026: 1/ SF is in full gold rush mode again, but history says the current winners won't stay on top forever. Every dominant technology eventually gets surpassed – newspapers, telecom, cable, Google in ads, IBM in computers. In AI the same pattern is already playing out: compute will hit walls, chips get dramatically more efficient, new energy sources emerge, and entirely new model architectures appear. The people feeling left behind today may just be early in a much longer cycle. (h/t @TurnerNovak) 2/ The largest $10B funds went from 140–150 collective early-stage deals per year in the SaaS era to 370–400 in the AI era. But the concentration is at the top of the market – top-decile rounds, known founders, proven operators. @kevinhartz calls it "option value": a small check today for the right to lead Series A tomorrow. The average seed round remains territory for EMs. 3/ We might be entering a Zombie VC era. ~85% of 2017–2018 vintage funds still haven't returned 1x DPI after 7–8 years. Median DPI sits at $0.34 on the dollar, while median IRR for the same cohort looks respectable at 11.6%. Paper returns hide the reality. The liquidity window opening over the next two years will be the moment of truth for most of these funds. 4/ @SpaceX IPO might be the single largest DPI event in VC history dropping into the lowest-distribution moment in venture capital history. @foundersfund alone, with an early $20M check in 2008, could return $60B (~3000x). When that capital hits LP accounts, it needs to be redeployed and that will circulate a new wave of fundraising for the same funds and fresh allocations from LPs who finally have liquidity to work with. 5/ The @cerebras IPO was the first real data point on crossover returns after two years of everyone writing off the model – both early-stage VCs and late-stage crossover funds made money on the same company, and LP conversations shifted from "do we have any exposure to the winners" to "how do we get into the next one." The same strategy that was declared dead in 2022-2023 got fully rehabilitated by a single exit. (h/t @MeghanKReynolds) 6/ Monte Carlo across 1,391 VC funds: concentrated portfolios (15 companies) and diversified ones (100 companies) produce the same average fund return – 2.44x. But compounded across multiple vintages, diversified wins: 2.25x vs. 1.78x. Concentrated funds carry more variance per fund, and variance drag compounds against you over time. The extreme outcomes (15x ) are almost exclusive to concentrated funds but the probability is tiny either way. (h/t Steve Kim) 7/ EM activity is showing the first real pulse in years. @cartainc logged 78 new US venture funds in the $10M–$100M range in Q1 2026 – a 34% jump from Q1 2025. Still well below the 2022 peak of 147, but the post-winter bottom might finally be in. The managers raising right now are doing it without a favorable macro, without easy LP recycling, and into a market where mega-funds are more active at seed than ever. (h/t @PeterJ_Walker) 8/ 76% of all EM-focused FoFs are American. The entire addressable market for a Fund I or Fund II isn't 132 FoFs – it's roughly 33. The other 100 exist, but Classic and Government-Led FoFs structurally can't anchor an early-stage vehicle: the check size doesn't justify the overhead, and a pension board can't be sold on a first-time manager without a track record. Geography and fund type filter out 75% of the market before the first meeting. (via @murphcapital) 9/ The 10-year fund is structurally mismatched with the assets mega-funds are holding. @SpaceX has been private for 18 years. @stripe for 15. For managers at that scale, @sequoia's move makes sense – open-ended, permanent capital, indefinite horizon. For small funds the logic runs the opposite way: the 10-year horizon enforced as a hard constraint, secondaries at Series C/D as the default exit, actual distributions on schedule. (h/t @credistick) 10/ There are only 3 positions that matter in a startup's cap table story: first investor, most helpful investor, biggest investor. Biggest is reserved for ~10 megafunds. First requires conviction most managers don't have – and LP preferences for concentrated portfolios often push against it structurally. So 90% of firms end up competing for "most helpful," which is why every pitch deck has a platform slide and every GP talks about their right to win oversubscribed rounds. (h/t @arian_ghashghai) Every month I track new fund launches, LP events, market reports, and what's actually moving in VC/LP. All of it in the @murphcapital newsletter: murphcapital.substack.com/p/…

Building fast laser comm links to space is really hard, @ObservableSpace is building them anyway We back teams that embrace challenges most would find “too hard”

Excited for Lux family co @westmagco led by brilliant @boxcardavid who is definition of an obsessed super smart sector founder who has likely forgotten more about motors actuators and magnets and robotics than most will ever know!;)

Dropping next week, special edition of @WeThe_Builders episodes at @RonaldReagan National Economic Forum. Interviews featuring: - Brian Hooks, CEO of @StandTogether and President of @ckochfoundation - deploying $1B/year through venture philanthropy to solve critical societal problems - Dan Wright (@danwrightSF), Cofounder and CEO of @armada_ai - $2B neo-hyperscaler cloud on the edge for AI era - Ian Cinnamon (@IanCinnamon ), Cofounder and CEO of Apex Space - $1B satellite platform to scale satellite manufacturing across difference use cases, big news dropping - David Bahnsen (@DavidBahnsen), Founder and CIO of @TheBahnsenGroup - $9.9B AUM wealth management firm Special thank you to @danrothschild, @ReaganInstitute team and @invariant team for having me and for putting on an incredible event featuring keynotes and talks from titans of industry and government including Jamie Dimon (CEO @jpmorgan), @SecScottBessent, @arjunsethi, @SteveForbesCEO, @BrookeLRollins

Space lasers making their way to @NYSE - most bits pushed and consumed by companies listed there will make their way through @ObservableSpace

This time it's different:

I thunk the same dynamic will play out in robotics. Model availability will be high and cheap. Value will accrue to those who have distribution and can effectively manage the models.

Dan sits down with Shahin @Farshchi of @Lux_Capital and AI Investor @annbordetsky at the @RBC private tech conference to discuss where the next wave of AI is headed. youtu.be/HjV6LC-WT3o

Everything that was unsexy and unloved in semis is hot: Power (Empower -> ADI this morning for $1B , unimaginable not long ago), litho, deposition/etch, metrology, packaging… no joke!

The most read S-1 in the world talks about the upside of in-space manufacturing? Love that!!

Such a cool blog! This describes the essence of what we’re doing @unconv …using the physical world to do computing. Computing is not an artificial thing; nature has discovered this concept over and over again. We’re building something that can harness nature to compute with the lowest possible energy

Every AI app and coding agent needs instant, often lumpy, access to compute Modal sells both the shovels and the sandbox Proud to be partnered with @bernhardsson and his team as they build the inference layer the next generation of software will run on:

Sovereign AI compute, built in America, deployable anywhere in days not years. Proud to be partnered with @armada_ai as it announces its factory for token factories:

Excited for @AmcaINC’s next phase of growth: strengthening the industrial backbone with the right mix of tech execution coupled to the great companies that brought us here today:

W-6 is back. This flight pushed on two fronts: autonomous hypersonic navigation and next-generation thermal protection systems. High-cadence reentry missions in repeatable conditions.

BREAKING: Armada Raises $230M Series B at $2B Valuation co-led by Overmatch, BlackRock & 8090 Industries The company’s largest & heavily oversubscribed round to date, bringing total funding to nearly half a billion dollars. PLUS, Armada announces Galleon Forge One, a new modular data center manufacturing facility “Johnson Controls is working with Armada to rapidly deliver secure modular data centers at scale,” said Joakim Weidemanis, CEO of Johnson Controls. "Together, we have already deployed units across the United States and around the world, demonstrating the expertise and global reach required to support mission-critical environments. Johnson Controls' differentiated technology, U.S.-based manufacturing strength and Armada's edge computing expertise will deliver the thermal‑critical environments that perform predictably, deploy quickly, and scale with confidence.”