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Number of Minority-, Women-Led PE and VC Funds Raising Cash Slides
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By Yuliya Chernova, WSJ Pro
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Good day. The number of minority- and women-owned private-equity and venture funds that were actively raising capital declined last year for the first time in a dozen years, according to a recent report from fund-of-funds manager Fairview Capital Partners.
The firm counted 471 such funds as of the end of 2025, a drop of 12% from a peak of 537 the year prior. Most were raising their first fund. Venture capital firms accounted for about three quarters of the set. Fairview tracks what it calls “institutional-quality firms” majority-owned by women or minorities, primarily based in the U.S.
Most of the funds in the Fairview set weren’t able to reach their fund target last year, said Aakar Vachhani, managing partner at Fairview, which he expected to be the case again this year. About 19% of the firms haven’t raised a new fund in the past five years.
“A lot of these dynamics are specific for diverse managers. But also they are subject to the overall fundraising environment that has become more constrained,” Vachhani said.
As of last October, the number of global venture funds actively raising capital rose, hitting a record 7,901, according to data provider Preqin, a BlackRock company. At the same time, however, these funds targeted less capital, looking to raise an aggregate of $437.1 billion as of October, down from a peak of $503.5 billion at the start of 2025, per Preqin.
The decline in the number of minority and women-led firms raising capital comes amid a market trend toward concentrated capital flows into more established firms, and a broader turning away from diversity initiatives.
Still, the universe of minority- and women-led private-equity firms rose to 1,185 in 2025, up from 1,100 the year prior, according to Fairview.
“There continues to be a good amount of new fund formation,” Vacchani said. “We actually believe that the quality of the managers in the market now is better than it’s ever been."
Some venture fund managers hope that a turnaround is at hand.
"Our Fund 1 companies have raised over $200 million in follow-on financing with 60% female and underrepresented founders," said Ariel Ganz, founder and managing partner of Arben Ventures, a Palo Alto, Calif.-based pre-seed deep-tech health fund. "The traction is there, and I am optimistic that liquidity will return to female and minority emerging managers in this cycle," Ganz added.
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And now on to the news...
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Andrej Karpathy joined Anthropic’s pretraining team. MICHAEL MACOR/THE SAN FRANCISCO CHRONICLE/GETTY IMAGES
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Karpathy joins Anthropic. Andrej Karpathy, an OpenAI co-founder and former Tesla executive, has joined Anthropic. Karpathy announced his move in a Tuesday post on X. Karpathy joined Anthropic’s pretraining team, which oversees the data training process for the company’s Claude artificial-intelligence models. He will lead a new group focused on using Claude to accelerate pretraining research, according to Anthropic. Until 2022, Karpathy led a team at Tesla overseeing the functionality of its advanced driver-assistance system, Autopilot. He also was a founding research scientist at OpenAI
until 2017, according to his LinkedIn profile.
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A $50 Million Rocket Deal Fueled by Trump’s Hypersonic Dreams
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Rocket maker Exquadrum isn’t particularly old in the business of defense contracting. But the 24-year-old company has still been around a year longer than Ethan Thornton, the MIT dropout who is taking it over in an acquisition by his drone startup, Mach Industries. The $50 million cash-and-equity deal, completed in April and previously unreported, reflects the rapidly changing dynamics in the defense sector. Startups that spent years fighting for crumbs of the Pentagon’s budget as the handful of large defense corporations feasted are suddenly finding themselves welcomed to the table and courted by Silicon Valley venture capital.
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Private Equity’s Exit Drought Claims Its Latest Victim—the IRR Metric
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The internal rate of return, or IRR, has long reigned as private equity’s most popular performance measure, despite critics who fault its malleable nature. But the gauge is being eclipsed by another metric, not so much because of purported flaws but as a result of changes overtaking the industry. A dearth of asset sales by private-equity firms after interest rates rose from near zero about four years ago has hampered the ability of fund managers to return capital to their investors. Faced with dwindling liquidity, fund investors increasingly judge managers based on cash distributions rather than IRRs, which also reflect assumed market values of unsold assets, according to investment and consulting firm leaders.
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Source: Strada/Artemis Strategy Group survey of 1,498 U.S. executives and senior talent leaders, conducted March 3-22, 2026. See the full chart
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New narrative. Employers have singled out AI in recent years as a reason to cut back on hiring college graduates. Now some companies are flipping that narrative, saying AI is boosting their need for entry-level workers. In one of the biggest surveys on employers’ graduate hiring plans this year, nearly three times as many executives at companies using or exploring AI said they were increasing junior-level hiring in 2026 than cutting back. Those using AI most extensively were the most bullish, according to Strada Education Foundation, which surveyed about 1,500 employers.
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Funds
Houston-based Veriten closed its second flagship energy venture fund with over $105 million in commitments.
People
Kleiner Perkins said Aatish Nayak is joining the firm as a partner. He was previously at Harvey.
Autonomous driving technology developer Nuro appointed Mike Mancini as chief financial officer. He previously served as CFO at Energy Recovery, Astranis Space Technologies and Aerion Supersonic.
Geothermal power systems developer XGS Energy appointed Richard Chong as chief financial officer. He was most recently vice president of finance at Calpine.
Laminar, an AI platform that powers fully autonomous process manufacturing, named Sanjay Rajan as chief revenue officer. He joined the company last year as head of go-to-market.
Exits
Analog Devices agreed to acquire Empower Semiconductor for $1.5 billion in cash. Milpitas, Calif.-based Empower develops technology designed to reduce the financial and energy cost of owning data centers.
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Amca, an El Segundo, Calif.-based startup developing and manufacturing critical aerospace and defense components, landed $300 million in Series B funding, giving the company a valuation of more than $1 billion. Caffeinated Capital led the investment, which included participation from Lightspeed Venture Partners, Andreessen Horowitz, Lux Capital and others.
Rapido, an India-based ride hailing company, nabbed a $240 million investment at a $3 billion valuation. Prosus led the financing, which included participation from WestBridge Capital.
Armada, a San Francisco-based edge computing startup, scored $230 million in Series B funding at a pre-money valuation of $2 billion. Overmatch, BlackRock and 8090 Industries co-led the round, which included contributions from Felicis, Lux Capital and several others.
Radar, a New York-headquartered AI-powered retail intelligence platform, raised $170 million in Series B funding, bringing the company’s valuation to $1 billion. Gideon Strategic Partners and Nimble Partners co-led the investment, which saw participation from Align Ventures.
Moment, a New York-based AI operating system for investment management, secured $78 million in Series C funding led by Index Ventures.
Bunch, a Berlin-headquartered fund operations platform for private markets, closed a $35 million Series B round. Portage led the funding, which included additional support from Illuminate Financial, Motive Partners, Cherry Ventures and FinTech Collective.
Ocean, an agentic email security platform headquartered in New York and Tel Aviv, launched from stealth with $28 million in funding from investors including Lightspeed Venture Partners, Picture Capital and Cerca Partners.
Scope, a London-based AI workflow platform for the heavy asset inspection industry, picked up a $20 million investment. Index Ventures led the round, which included contributions from Susa Ventures and Entrepreneurs First.
Rely, a Portland, Maine-based transaction automation platform for the multifamily industry, was seeded with a $4.5 million investment led by 2048 Ventures.
Avian, a Switzerland-based startup building thermal monitoring technology for fire-prone industrial sites, collected a $2.6 million pre-seed round led by Founderful.
Contrario, a San Francisco-headquartered recruiting platform, launched with a $2.3 million seed investment led by Nexus Venture Partners.
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SendCutSend manufactures custom sheet-metal parts at its Reno, Nev., factory complex. LAUREN LINDLEY
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