The public markets are thinning, the private markets are exploding, and AI is wholly destabilizing both.
Consider the past week’s software meltdown: AI fears and stalled market dynamics vaporized $1 trillion in market value, rippling down to private companies.
“The funding mechanism for the software LBO complex has short-circuited, IPO markets have been weak, and it’s gummed up the machinery,” said Paul Wick, chief investment officer at $30 billion investment firm Seligman. “There’s no more red line where software stocks won’t go below a certain point… It’s a psychological shift, as well. People are more fearful.”
Wick has long been watching the public and private markets intersect and diverge—he started investing in tech in the 1990s. In 1999, he first met Umesh Padval, then CEO at public semiconductor company C-Cube Microsystems. The pair kept in touch over the years, bonding over a shared love of wine and a realism about tech.
“I had wanted to do something in VC for a long time, but it’s hard to find the right people and the right opportunity,” said Wick. “And then Umesh was available.”
Seligman, today, is launching venture arm Seligman Ventures, a $500 million fund emphasizing early-stage AI investing, Fortune has exclusively learned. Padval—an early investor in Cohere, Relyance AI, Exaforce, and Harness—will lead the charge, joined by Ashish Kakran and Eddie Ackerman.
Unlike Lightspeed and Andreessen Horowitz which deploy billions, Padval is looking to stay considerably smaller: “I’ve always believed in the Benchmark-type model, stay in the $400 million to $800 million-range, build those companies, and get 10x from there. I’m a firm believer in not having too much money, because discipline goes away.”
The idea is for Wick and Padval, united under one LP, to share information, with Padval bringing what he sees early in the pipeline to Wick, and vice versa. To this end, Seligman Ventures will focus on AI infrastructure, cloud infrastructure, cybersecurity, and modern data center hardware. And it may seem counterintuitive, but from Wick’s seat: The real value is showing up early, before later-stage investors fun-house-mirror a company’s value.
“There’s a tendency for late-stage funding rounds to be aggressively valued, and the earlier-stage VCs love to see their investments marked up, so they don’t put up a fight,” said Wick. “But when you see these companies finally go public, their IPOs are not a resounding success. Many times, they’ll be at the same price four or five years ago. No one’s making money flipping IPOs. So, bringing Umesh and his colleagues on board with their focus on early stage resonated with me.”
Padval and Wick, in some sense, are trying to solve a problem that everyone is trying to solve: As companies stay private longer, swallowing more capital than ever, where does value actually lie?
A point in their favor is that, in a historic sense, the firm has been here before: Seligman has its roots in J. & W. Seligman & Co., an investment bank founded in 1864. And J. & W. Seligman & Co. helped finance the Panama Canal and railroads through the Industrial Revolution—another era when new tech was destabilizing markets faster than anyone could map them.
See you tomorrow,
Allie Garfinkle
X: @agarfinks
Email: alexandra.garfinkle@fortune.com
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VENTURE CAPITAL
– Loyal, a Dallas, Texas-based developer of longevity drugs for dogs, raised $100 million in Series C funding. age1 led the round and was joined by Baillie Gifford and existing investors.
– Lassie, a Stockholm, Sweden-based pet insurance platform, raised $75 million in Series C funding from Balderton Capital, Felix Capital, Inventure, and others.
– GitGuardian, a Paris, France-based non-human identity security platform, raised $50 million in Series C funding. Insight Partners led the round and was joined by Quadrille Capital and existing investors.
– Equal Parts, an Austin, Texas-based AI-native insurance distributor, raised $23 million in Series A funding. Inspired Capital led the round and was joined by Equal Ventures, Max Ventures, and Genius Ventures.
– Matia, a Miami, Fla.-based data operations platform, raised $21 million in Series A funding. Red Dot Capital led the round and was joined by existing investors.
– WINN.AI, a Tel Aviv, Israel-based sales assistant platform designed for coaching and guidance during customer calls, raised $18 million in Series A funding. Insight Partners, Mangusta Capital, and S Capital led the round and were joined by Moneta, Highsage, Alumni Ventures, Sarona Ventures, and OurCrowd.
– Meridian, a New York City-based AI-powered financial modeling platform designed to integrate with Excel, raised $17 million in seed funding. Andreessen Horowitz and The General Partnership led the round.
– Take2, a New York City-based agentic AI platform designed for health care recruiting, raised $14 million in Series A funding. Human Capital led the round and was joined by Bertelsmann Healthcare Investments, Reach Capital, SemperVirens VC, and Honeystone Ventures.
– Scala.ai, a Bellevue, Wash.-based intelligence platform designed for contact centers, raised $8.5 million in funding, including $7.5 million in seed funding. Madrona and FUSE led the seed round.
– Upside Robotics, an Ontario, Canada-based developer of autonomous robots designed to feed crops, raised $7.5 million in seed funding. Plural led the round and was joined by others.
– Bracket, a London, U.K.-based FX, treasury, and cash management platform, raised $7 million in funding. Macquarie Group and Blackfinch Ventures led the round and were joined by others.
– Pelgo, a New York City-based agentic AI platform designed to help with career transitions, raised $5.5 million in seed funding. Flybridge Capital Partners led the round and was joined by Eniac Venures, Primary Venture Partners, and 645 Ventures.
– Heywa Labs, a London, U.K.-based generative UX platform, raised $5 million in seed funding. Cherry Ventures led the round and was joined by Openseed, Pareto, Plug & Play, Ventures Together, and angel investors.
– Seamflow, a London, U.K.-based developer of AI software for the testing, inspection, and certification industry, raised $4.5 million in seed funding. Northzone and Initialized Capital led the round and were joined by Garry Tan and others.
– Cydelphi, a Dallas, Texas-based developer of an AI-enabled digital forensics & incident response platform, raised $3 million in seed funding. Glasswing Ventures led the round and was joined by Blu Ventures, Hyde Park Angels, and Merlin Group.
PRIVATE EQUITY
– Smarte Carte, a portfolio company of 3i Group, acquired Lost and Found Software, a Frankfurt, Germany-based developer of lost property operations software. Financial terms were not disclosed.
PEOPLE
– Bessemer Venture Partners, a San Francisco-based venture capital firm, promoted Maha Malik to Vice President.
– Branford Castle Partners, a New York City and Boca Raton, Fla.-based private equity firm, promoted Marilyn Yang to managing director.
– Copilot Capital, a London, U.K.-based private equity firm, promoted Dave Sun to partner and Zerxis Billimoria to director.
– Felicis, a Menlo Park, Calif.-based venture capital firm, promoted James Detweiler to general partner and Eric Flaningam to partner. The firm also hired Michael Chen, who was previously with Applied Compute, as venture partner.