Venture capitalists are shifting their focus from funding startups to acquiring mature businesses and optimizing them with artificial intelligence. This strategy is often compared to private equity roll-ups and is being employed by firms like General Catalyst, Thrive Capital, and solo VC Elad Gil.
General Catalyst has already backed seven companies using this approach, including Long Lake, which secured $670 million in funding to streamline community management for homeowners associations. Other venture outfits, such as Khosla Ventures, are also considering this investment model.
Khosla Ventures’ general partner Samir Kaul believes that partnering with established businesses and AI can help AI startups gain access to large clients. However, the firm wants to proceed with caution and assess the strategy’s potential returns before scaling up.
“We don’t have that expertise,” Kaul said. If early bets pan out, Khosla would likely partner with a private equity-style firm to help with acquisitions rather than hiring a team.
Source: https://techcrunch.com/2025/05/23/khosla-ventures-among-vcs-experimenting-with-ai-infused-roll-ups-of-mature-companies