The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch 20VC: OpenAI's $3BN Acquisition of Windsurf: The Breakdown | Are Endowment Funds F******* & How LP Deployment to Venture Will Change in 2025 | Why Revenue Multiples are BS, The Rise of AI Rollups and Multi-Stage Funds Destroying Seed Investing
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Apr 24, 2025 
Rory O'Driscoll, a partner at Scale Venture Partners with over 25 years in venture capital, and Jason Lemkin, co-founder of SaaStr and expert on SaaS, dive into the recent $3 billion acquisition of Windsurf by OpenAI. They discuss why multi-stage funds are undermining seed investments, the challenges faced by endowment funds, and why revenue multiples may be misleading. The rise of AI rollups and their implications for competitive markets also get a thorough analysis, alongside insights on how to navigate evolving investment landscapes.
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OpenAI's Strategic Windsurf Bet
- OpenAI's rumored $3 billion acquisition of Windsurf represents a strategic bet to own a key AI coding use case.
- This move addresses OpenAI's relative weakness in encoding compared to competitors like Anthropic.
Multi-Stage Funds Squeeze Seed
- Multi-stage venture firms with low cost capital are increasingly dominating seed investing.
- This squeezes seed-only funds by pushing ownership down and raising risk pressures for seed managers.
Patience Before Breakout Growth
- Venture investing in high-growth startups requires patience during indeterminate product-market fit periods.
- Success can suddenly accelerate, turning a struggling company into a multibillion-dollar opportunity quickly.