The Next Chapter of USV

In 2004, USV founders Fred Wilson and Brad Burnham published a memo to the Limited Partners of our inaugural fund. In this memo, they wrote, “we believe that we will generate superior returns by investing in early stage companies that exploit the now ubiquitous Internet infrastructure and add value to broadly available core technologies.” It was this original thesis that enabled them to clearly see the opportunity ahead of them and back category-defining winners such as Twitter, Twilio, Etsy, MongoDB, and Coinbase in the early days of the modern Internet and mobile ecosystems.

Fast forward more than 20 years, and technology is going through a similar revolution today. The AI infrastructure buildout is well underway, and the superpowers it enables are readily available to startup builders all over the world. Leveraging programmable intelligence, founders have the ability to build incredible new products that are only now possible. A single person can use AI to turn an idea into a working product in a matter of days, and assemble a full-blown team of agents to support that product for a fraction of the cost of hiring a traditional team. These changes have profound implications for how we want to build USV.

I. Team

We have added to our partnership with product-centric builders that have deep insight and learned experience in what it will take to build the next generation of breakout businesses. While AI has made it possible for more people to build far more products faster than ever before, we believe that building a great product has never been more challenging. The sheer number of startups emerging from the AI revolution means standing out among the crowd becomes that much more difficult. And the scale of incumbent aggressiveness and uncertainty around defensibility makes well-trodden playbooks seem much less trustworthy.

Recently, our newest team members, including our new GP Michael Mignano (cofounder of Anchor), Venture Partner Jared Hecht (cofounder of GroupMe, Fundera), and Product Advisory Partner Scott Belsky (cofounder of Behance, former CPO at Adobe), have helped us adopt a builder’s mindset throughout everything we do.

As we always have, we believe in a small, tight, cohesive partnership that operates quickly, pushes forward ideas together, and supports a portfolio collectively. These new team members, alongside longtime USV investors Fred Wilson, Rebecca Kaden, Nick Grossman, and Nikhil Raman, will make up our core investment team moving forward, while Andy Weissman, Albert Wenger, John Buttrick, and Brad Burnham will continue supporting USV and its portfolio companies. And as always, our finance & operations are led by the formidable Kerri Rachlin.

II. Fund size

At USV, we’ve always believed in the power of constraints, and keeping our funds small relative to the rest of the market has enabled us to remain thesis-driven, stay true to our values, and tightly align interests among our Limited Partners, the founders, and each other. Our last core fund was $275M.

Now, the game on the field has changed as a result of AI. As it’s become easier to build, demand for the best companies has risen. This means bigger rounds and higher prices. It’s always been our goal to back the best founders in the world working on the ideas we are most excited about and support them throughout the entirety of their journeys. Today, that takes more capital.

These funds let us do more of that: we can lead more rounds, support companies for even longer, and invest in categories that take more capital to win, including robotics, manufacturing, and energy.

USV will continue to back category-defining companies that align with our theses. We will make roughly the same number of investments as in previous funds, and always with a strong perspective on the business, team, and product. But now, we will be investing at the scale founders expect in 2026 and beyond.

III. Theses

USV remains a thesis-driven firm. As always, we’re looking to back the very best teams building at the edge of large markets being transformed by technology. But with AI, we’ve been able to more clearly articulate how we think markets will be transformed:

1. We believe AI will obliterate markets, not automate them. We fund the companies at the application layer that leverage AI to not simply make existing markets move faster, but to instead reshape those markets completely.
2. We believe the most valuable data in the world is the data that has been impossible to reach until now. We call this Data at the Edge. We fund the companies aggregating it through physical intelligence or AI that unlocks offline data that was previously out of reach. This includes not just software businesses but also robotics, manufacturing, sensor networks, and businesses that scale online to off.
3. We believe both consumers and enterprises will seek ever-more powerful intelligence while seeking tighter incentive alignment across vectors such as trust, security, memory, and costs. We call this The Rebel Alliance.
4. We believe that none of the above can happen without significantly more energy, which we began investing in through a dedicated fund beginning in 2021. Our energy thesis merges into our core fund moving forward.

In 2004, Fred and Brad bet that the next great companies would be built on top of the Internet. In 2026, we're making the same bet on intelligence. The questions are big, the opportunities are market-shifting, and the scale and speed are unprecedented. We are in a time where what is built will shape how we live, how markets form and function, and what becomes possible.

We're grateful to the founders of our portfolio companies and our Limited Partners for trusting us with what comes next. And we want to work with the people building it.

– Nick Grossman, Rebecca Kaden, Michael Mignano, and Fred Wilson