Good day. Tucked into the “big beautiful bill” signed by President Trump is a new incentive for shareholders of venture-backed startups to sell their shares on what is known as the secondary market. Investors don’t expect the change to trigger a stampede of sellers, but they say cashing out earlier is now a bit easier.

The new tax-and-spend law expands the Qualified Small Business Stock tax exclusion to allow investors in startups to sell more of their holdings early without paying capital-gains taxes. The new bill raises the per-issuer cap on eligible gains to $15 million, from $10 million, allowing investors to reap the benefits while holding shares for shorter periods.

The new provision also increases the maximum asset threshold for a company to qualify as a small business from $50 million to $75 million and introduced a tiered holding period for capital-gains tax exclusion, which could offer shareholders more flexibility for exits before the five-year mark.

The changes could serve as another boost to the so-called secondary market, where shares of still-private companies can be traded. Venture firms typically wait to cash out of their investments until companies are either acquired or go public. A relative lack of exits in the past few years has made secondary deals more popular as firms need to return capital to their investors.

Read the full article here.

And now on to the news...

SpaceX to invest $2 billion into xAI. Elon Musk’s SpaceX has agreed to invest $2 billion in his artificial-intelligence company xAI, investors close to the companies said, nearly half of the Grok chatbot maker’s recent equity raise, The Wall Street Journal reports. Musk has repeatedly mobilized his business empire to boost the AI startup, which is racing to catch up with OpenAI. Earlier this year, he merged xAI with X, combining what was a small research lab with a social-media platform that helps amplify the reach of its Grok chatbot. The merger valued the new company at $113 billion.

• The SpaceX investment is part of xAI’s $5 billion equity fundraise announced by Morgan Stanley last month. It is the rocketmaker’s first known investment into xAI and one of its largest in another company.

Google has agreed to pay about $2.4 billion in a deal to license the technology of AI coding startup Windsurf and hire its CEO and some of its employees, WSJ reports, citing people familiar with the matter. The deal comes after talks for OpenAI to acquire Windsurf stalled, the people said. The Alphabet unit is hiring a small number of Windsurf employees to focus on agentic coding within its DeepMind division, and the tech giant will also acquire a nonexclusive license to some of Windsurf’s technology.

• Google isn’t taking a stake in Windsurf. Most of Windsurf’s existing employees will remain at the company.

An executive order President Trump issued last week created fresh uncertainties for renewable-energy investors, including private-equity firms, only days after the passage of his tax-and-spending bill encouraged developers to start new projects within the next year. Concerns about the Trump administration’s clean-energy policies, particularly on tax credits, since his November election has made it more difficult for wind and solar developers to finance new projects, leading to delays and cancellations, according to industry analysts. Read the full WSJ Pro article

Tech and geopolitics. This tiny country, which shares a border with Russia, offers a glimpse into how digital technology will play a role as societies mobilize civilian and military networks against a larger adversary.

The Baltic state with a population of about 1.37 million has long punched above its weight in technology, producing people behind internet communications pioneer Skype as well as financial technology company Wise. It’s also been a pioneer in digital citizenship and voting, and fostered blockchain and cryptocurrency.

Sten Tamkivi, a Skype veteran and startup founder, wants to harness that technological know-how to strengthen the resilience of Estonia and Europe itself amid growing concern about Russia. Estonians Tamkivi and Wise co-founder Taavet Hinrikus teamed up with other founders and chief executives around Europe and formed Plural to make early-stage investments in ambitious startups in areas such as healthcare, energy and defense.

Read the full column.

Nuclidium, a clinical-stage radiopharmaceutical company developing a proprietary copper-based theranostic platform, said it raised 79 million Swiss francs ($99 million) in a Series B round. The round was led by Kurma Growth Opportunities Fund, Angelini Ventures, Wellington Partners, and Neva SGR. The proceeds will be used to advance the clinical development of Nuclidium’s Copper-61/Copper-67 theranostic pipeline across multiple oncology indications. In parallel, the company said it will expand its production and manufacturing capabilities through a global production network.

Vellum, an enterprise- development platform for building, testing and deploying AI products, said it has raised $20 million in Series A funding. The round was led by Leaders Fund. Vellum said it has received $24.5 million in funding to date.

Polimorphic, a New York-based AI for government startup, raised an $18.6 million Series A round led by General Catalyst.

Kuru Labs, a Singapore-based trading platform built on blockchain network Monad, raised a $11.6 million Series A led by Paradigm.

Abacus AI, a San Francisco-based accounting assistant startup, raised $6.6 million in seed funding led by Menlo Ventures, with participation from Pear VC, Recall Capital and Original Capital.

Knox, a federal managed cloud provider, said it raised a $6.5 million seed round led by Felicis with participation from Ridgeline and FirsthandVC. The investment will enable Knox to bring artificial intelligence and software-as-a-service applications to government agencies, the company said.

Bloom, a London-based crypto trading startup, has raised a $1.6 million pre-seed round led by Lightspeed Faction.

• Apple offers as much as $150 million for Formula One U.S. rights
   
• Can Pittsburgh’s old steel mills be turned into an AI hub?
   
• Can AI solve the content-moderation problem?
   
• Sam Altman is up, Tim Cook is down: big tech’s Trump scorecard 
   
• Why you shouldn’t buy an iPhone right now

This newsletter was compiled by Marc Vartabedian and Matthew Strozier.

WSJ Pro Venture Capital is a premium service of The Wall Street Journal. We cover venture capital and the global startup ecosystem. Share your tips, comments and questions: vcnews@wsj.com

The Team: Matthew Strozier, Yuliya Chernova, Brian Gormley and Marc Vartabedian.

Follow us on X: @wsjvc