USV raises $900M, its biggest fund cycle in 20 years
What's the deal? Union Square Ventures (USV) has raised $900 million across two new vehicles — a $500 million Core Fund for early-stage deals and a $400 million Opportunity Fund. It is the largest fund cycle in the New York firm's history.
Why now? USV spent 20 years deliberately keeping its funds small. General partner Fred Wilson believes AI today resembles the internet in 2003: the infrastructure is here, but the defining applications are still unbuilt.
What's the endgame? The new thesis is "obliterate, don't automate." Rather than making industries incrementally more efficient, USV is betting AI will restructure them entirely — replacing professionals with AI lawyers, accountants, and doctors.
The firm, led by Wilson alongside general partners Rebecca Kaden, Michael Mignano, and Nick Grossman, was an early backer of TwitterDealroom has a profile for this one. Try Dealroom →, Coinbase, Stripe, MongoDB, Twilio, Etsy, Duolingo, and Abridge. More than 20 years after Wilson and Brad Burnham set out USV's original internet thesis, the firm is scaling up for what it sees as the next platform shift.
What could go wrong? USV's partners argue AI is making products cheaper to build but breakout companies potentially more expensive to create. They also warn that annual recurring revenue can mask weak retention — a sign of froth in fast-growing AI startups.
The signal: One of venture's most disciplined early-stage firms is breaking its own rule on size, a move that reflects how much capital investors believe the AI shift will demand — even as USV maintains that smaller funds still pick better.
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