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Welcome to the week where Nvidia's GPUs are literally too powerful for Earth's electrical grid to handle, and founders invented a new class of stock that lets them cash out while pretending they're still all-in.
As we continue to build at Context Ventures, we've launched Startup Intros with a simple mission: to help early-stage founders find the right investors, faster and smarter.
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Here's what's moving markets and making headlines:
🎯 BLUF: Bottom Line Upfront
Nvidia's Power Crisis: New chips need 25 gigawatts by 2026, almost as much as the entire US grid added last year, with data centers sitting idle waiting for electricity
$162B Secondary Market Insanity: Private share trading up 45% YoY, with AI startups trading at premiums while everyone else takes 27% haircuts
Founder Preferred Stock Scam: 11% of startups now issue special shares, letting founders cash out without tanking employee option prices
Fusion's $3B Fantasy: Commonwealth Fusion raised $863M (total: $3B), promising commercial fusion by 2027, which has been "20 years away" since 1950
OpenAI's India Escape: Building a 1GW data center in India because America's grid literally can't handle more AI infrastructure
🔌 The Great Power Crisis: When AI's Appetite Exceeds Earth's Grid
Photo by Mariia Shalabaieva on Unsplash
⚡ Nvidia's Power Problem: When Your Chips Are Too Much for the Grid
The Economist just dropped a reality bomb: Nvidia's meteoric rise might get short-circuited by something as basic as electricity.
The Math of Doom: Between Feb 2024-26, if half of Nvidia's chips stay in the US, they'll need 25GWs of new power; almost as much as the entire US grid added last year. Each high-end GPU burns 700W, and last year's sales alone could power 1.3M homes.
The Bottleneck From Hell: Data centers are sitting idle waiting for power connections, while utilities are basically saying, "LOL, good luck with that." Nvidia's selling chips faster than humanity can build power plants.
What This Means: Nvidia's growth could flatline, not because of competition or innovation, but because we literally can't generate enough electricity. Imagine having the most advanced AI chips on Earth, but being unable to use them.
🇮🇳 OpenAI Plans Massive India Data Center Because US Can't Handle More
OpenAI is building a 1-gigawatt data center in India, part of its Stargate infrastructure program, which is apparently colonizing the entire planet with GPUs.
The Scale: 1GW could power tens of thousands of AI chips, basically a small city's worth of electricity. India is now OpenAI's second-largest market, and with their new Digital Personal Data Protection Act, keeping data local is mandatory.
The Politics: This aligns with India's $1.2B IndiaAI Mission, because every country needs its own AI strategy now. Sam Altman is visiting India in September to announce the details.
The Real Play: While the US power grid creaks under AI's demands, OpenAI's betting on countries desperate for tech investment to provide the infrastructure, as Microsoft, SoftBank, and Oracle are backing Stargate globally.
🔥 The $3B Fusion Dream & America's Nuclear Renaissance
⚡ Commonwealth Fusion Raises $863M Because Physics is Optional Now
Commonwealth Fusion Systems has just raised $863M from a diverse group of investors, including Nvidia, Google, Bill Gates' Breakthrough Energy, and a consortium of 12 Japanese companies.
The MIT Spin-Out's Pitch: They're building SPARC, a prototype reactor in suburban Boston that'll supposedly achieve "scientific breakeven" by 2027, where the reaction produces more energy than it takes to start. Then they'll build ARC, a commercial plant in Virginia that Google's already agreed to buy 200MW from.
The Reality Check: CFS has now raised $3B total, more than any fusion startup, to build something that's been "20 years away" since the 1950s. CEO Bob Mumgaard admits ARC will cost "several billion more," and they don't even know where that money's coming from.
Why This Time Might Be Different: Their tokamak design uses superconducting magnets that didn't exist a decade ago, and AI is supposedly accelerating R&D. Plus, with data centers about to consume entire power grids, tech giants are desperate enough to bet on fusion actually working before 2050.
🔬 Los Alamos Scientists Channel THOR to Make Fusion Less Impossible
Government scientists at Los Alamos just had a Marvel moment, achieving fusion ignition using something called THOR (Thinned Hohlraum Optimization for Radflow).
What They Actually Did: Created special "windows" in the gold-coated cylinders that hold fusion fuel, letting X-rays escape so they can better observe how materials react to plasma conditions. They pulled it off in less than a year, which in government lab time is basically light speed.
The Awkward Part: The press release casually mentions this tech is also valuable for "weapons development," because nothing says clean energy future like also advancing nuclear arsenals.
💰 DOE Throws $35M at National Labs to Make Energy Great Again
The Department of Energy is spreading $35M across national labs for everything from new nuclear reactors to wind farms.
The Strategy: Use the Technology Commercialization Fund to turn lab innovations into actual products before China beats us to it. Projects span nuclear, wind, and "possibly wave energy" (because why not harness the ocean while we're at it).
The Timeline: Achieve carbon-free electricity by 2035 and net-zero emissions by 2050, which requires either breakthrough physics or time travel, but at least we're funding both.
💸 The Weird New Market Where Founders Cash Out While You Can't
Photo by Leo_Visions on Unsplash
📈 Secondary Markets Hit $162B as Everyone Pretends Startups Are Liquid
The secondary market for startup shares exploded to $162B in 2024, up 45% YoY, creating a bizarre parallel universe where private companies trade like public ones except nobody knows the real price.
The New Reality: AI startups and "$100B+ Private Mag 7" companies are trading at premiums (OpenAI or Anthropic will get above last-round valuations). However, if you're a Series B SaaS company, good luck getting 70 cents on the dollar.
The Stratification: Elite AI startups have buyers lined up around the block, while 90% of companies can't find liquidity at any price. Private markets are projected to hit $62T by 2034, growing twice as fast as public markets.
What's Actually Happening: Institutional investors are piling into private markets because public markets are "too volatile," which is hilarious given private valuations are literally made up. Meanwhile, retail investors are getting "access" through platforms that let them buy tiny slices at inflated prices with zero liquidity.
🎩 Founder Preferred Stock: The New Way to Have Your Cake and Sell It Too
Nearly 11% of startups now issue "founder preferred" stock, double from two years ago, because founders discovered they can sell shares without looking like they're abandoning ship.
The Magic Trick: These "Series FF" shares (named after Founders Fund who popularized them) act like common stock in founders' hands but convert to preferred when sold. This lets founders cash out without spiking the 409A valuation that determines employee option prices.
Who's Doing It: Perplexity, Mercor, Skild AI, and basically every hot AI startup where founders have leverage. Stripe and Anduril pioneered it, and now it's spreading like a virus through companies with repeat founders who know the game.
The Controversy: Some VCs hate it because it signals founders want early liquidity. One Fenwick & West lawyer said a VC recently refused to invest unless the startup killed its founder preferred stock. Meanwhile, employees receive another layer of preferred stock ahead of them in the event of liquidation.
The Real Tell: When 11% of startups are structuring special shares so founders can sell early, you know everyone's thinking about exits before they've even found product-market fit.
⚡ Startup Quick Hits: From Vibe Coding Apps to $100M+ Raises
🚀 Vercel Triples to $9B Because Startups Need Infrastructure: The web infrastructure darling has just raised $400M, led by Accel, at a $9B valuation, nearly tripling from its $3B tag just last year. With every AI startup needing deployment infrastructure, Vercel's Next.js framework has become the default choice for devs who'd rather ship than manage servers.
🎨 Framer Hits $2B Valuation For Websites Done For You: The Dutch no-code website builder raised $100M Series D from Meritech and Atomico. With enterprise customers now driving most sign-ups (including Miro, Perplexity, and Scale AI), Framer's betting that the future of web design is dragging and dropping, not debugging JavaScript.
🗾 LayerX Scores $100M to Fix Japan's Office Worker Crisis: The Japanese AI SaaS startup raised $100M Series B led by TCV, tackling the brutal reality that only 16% of digital transformations succeed. With Japan facing aging demographics and labor shortages, LayerX is automating finance, tax, and HR tasks for enterprises still drowning in paperwork.
💰 33 AI Startups Have Raised $100M+ in 2025: We're not even through Q3, and already 33 US AI companies have hauled in mega-rounds, with multiple billion-dollar raises and several companies double-dipping for seconds. Last year's 49 mega-rounds now look quaint as 2025 is on pace to shatter that record.
⚡ VC Quick Hits: From Drug Manufacturing to Women’s Health
💊 Mark Cuban's Cost Plus Drugs: Fighting America's $5T Healthcare Racket: The billionaire maverick is waging war on pharmacy benefit managers (PBMs) by selling drugs at actual cost plus 15%, turning $1000 chemotherapy meds into $21 purchases. Cuban's building his own robotics-driven factory in Dallas that can switch drug production in four hours, solving those "convenient" shortages that mysteriously jack up prices.
🔄 Lakestar Raises $265M to Hold Winners Hostage Longer: The European VC behind Spotify and Revolut just closed a $265M continuation fund, essentially moving portfolio companies from one pocket to another so they don't have to exit in this garbage IPO market. Led by secondary specialist Lexington Partners, this lets Lakestar keep milking their winners while giving LPs who want out a graceful exit (at a discount, naturally).
🩺 Portfolia Bets $20M That Women's Health Isn't Just a Niche: Trish Costello's Portfolia just launched a $20M fund for women's health startups, targeting the $48B market opportunity that male VCs somehow keep missing. Despite record funding in 2024, women's health companies still can't find exits or growth capital, shocking that an industry run by dudes in Patagonia vests doesn't prioritize menopause innovation.
💸 In Other Bay Area Funding News
Here's a roundup of notable recent funding rounds across various sectors in the Bay Area:
🤖 AI & Machine Learning
Assort Health: Raised $50M Series B led by CentCor Partners to deliver personalized benefits guidance through AI-driven insights tailored to employer health plans.
Aurasell: Raised $30M Seed led by Next47 for their AI-first sales platform that automates complex sales processes from discovery to follow-up.
FriendliAI: Raised $20M Seed led by KB Investment for their generative AI inference optimization platform that reduces costs while maintaining performance.
Splight Tech: Raised $12.4M led by Third Sphere to expand their AI-powered grid management system for renewable energy infrastructure.
Barti: Raised $12M Series A led by Bain Capital Ventures for autonomous AI agents that handle customer inquiries across multiple channels.
Intent Inc: Raised Seed funding led by Two Sigma Ventures to develop AI-powered consumer demand analytics and forecasting.
Neura: Raised funding led by Yoni Cheifetz, Amit Rosenzweig for making LLMs fast, private, and production-ready.
Fresh Victor: Raised $800K led by Elevate Brands for transforming food production with AI-powered automation.
Airwork AI: Raised $200K Pre-Seed for their AI task automation platform for creative workflows.
💼 Enterprise Software
🏥 Healthcare & Biotech
COVU: Raised $16M funding led by Catalyst Health Ventures for their primary care platform connecting patients with personalized healthcare services.
Petal Surgical: Raised $8M led by Elevate Ventures to develop next-generation surgical instruments for minimally invasive procedures.
Grata Health: Raised Pre-Seed funding led by Empath Ventures for their preventive healthcare platform.
Frontier Bio: Raised funding led by Alethea Capital, Axon Ventures for advancing frontier biotechnology solutions.
🚀 Other Notable Rounds
Portal to Bitcoin: Raised $50M Series A led by Polychain to simplify Bitcoin access with their user-friendly custody and trading platform.
Copper: Raised $28M Series A led by Andreessen Horowitz for their AI-driven renewable energy optimization platform.
Central: Raised $8.6M Seed led by ICONIQ Capital for their centralized platform streamlining organizational operations.
Mara: Raised $5.9M Seed led by Forge Ventures to build their AI-powered marketplace platform.
Bluejay AI: Raised $4M Seed led by Bain Capital Ventures for their intelligent automation platform.
Alio Labs: Raised $3M Seed led by Uncork Capital to develop innovative lab automation solutions.
Total Deals: 22, totaling $290M
Please note that we're still working on building our data pipelines to identify pre-seed rounds as they come.
🤝 M&A Activity
CrowdStrike acquired Onum for $290M, adding telemetry pipeline management capabilities to strengthen their cybersecurity platform's data processing infrastructure.
Gusto acquired Guideline, bringing together payroll and retirement plan services to create a comprehensive HR and benefits platform for SMBs.
Uniphore acquired Orby AI, integrating business AI cloud capabilities to enhance its conversational automation and customer experience platform.
How 433 Investors Unlocked 400X Return Potential
Institutional investors back startups to unlock outsized returns. Regular investors have to wait. But not anymore. Thanks to regulatory updates, some companies are doing things differently.
Take Revolut. In 2016, 433 regular people invested an average of $2,730. Today? They got a 400X buyout offer from the company, as Revolut’s valuation increased 89,900% in the same timeframe.
Founded by a former Zillow exec, Pacaso’s co-ownership tech reshapes the $1.3T vacation home market. They’ve earned $110M+ in gross profit to date, including 41% YoY growth in 2024 alone. They even reserved the Nasdaq ticker PCSO.
The same institutional investors behind Uber, Venmo, and eBay backed Pacaso. And you can join them. But not for long. Pacaso’s investment opportunity ends September 18.
Paid advertisement for Pacaso’s Regulation A offering. Read the offering circular at invest.pacaso.com. Reserving a ticker symbol is not a guarantee that the company will go public. Listing on the NASDAQ is subject to approvals.
🌟 Editor's Note
At Startup Intros, our mission is to bring the latest founder-investor news straight to your inbox, keeping you ahead in the fast-paced world of Silicon Valley. Our free weekly newsletter delivers curated insights, deals, and trends to help you navigate the startup ecosystem.
Stay tuned for our upcoming paid daily newsletter, packed with deeper dives, plus weekly spotlights on top VCs, investors, and founders, and practical tips for raising your next round.
💭 Parting Thoughts
That's a wrap on another week where Silicon Valley invented new ways to sell out while staying in, and discovered that all the AI chips in the world are useless if you can't plug them in. Between founders cashing out through financial engineering and Nvidia's GPUs literally breaking the power grid, we've reached peak "innovation" where the biggest problems aren't technical; they're just physics and greed.
Forward to a friend or hit reply to let me know what you're seeing in your world.
Till next time,
Dev Chandra
CEO @ Startup Intros
Associate @ Context VC
LinkedIn: /in/devchandra
Tim Hsia
Investor @ Context VC
Co-Founder @ Startup Intros
LinkedIn: /in/timhsia
P.S. Raised this week, and we missed you? Want to be featured? Have tips or funding questions? Reply or DM us as we’re here to help.
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