Our discussion below has been condensed and edited for clarity. You can watch the complete conversation at the bottom of this page. With SpaceX reportedly targeting a $1.75 trillion valuation at its IPO, and OpenAI and Anthropic potentially following suit, what does this mean for the broader market?

Andreas Stavropoulos: I recall how thrilling the Google IPO was—it reopened a market that had been deeply pessimistic about tech in the early 2000s. It acted as a catalyst, inspiring a new wave of entrepreneurs. We’re seeing a similar dynamic now. With each paradigm shift, the scale grows by orders of magnitude, which is natural. After all, in today’s information age, what business isn’t a technology business?

Ben Blume: These are exceptional companies. Each large liquidity event generates wealth and returns that flow back into funding the next generation of startups.

Niko Bonatsos: My co-founder at Verdict was the first investor in what is now Cursor. So if Elon Musk is feeling optimistic, perhaps Cursor—which he recently revealed he has the option to acquire for $60 billion—might also see some good news. More broadly, for the next wave of companies, as Andreas noted, they could target much larger markets. Immigrant founders, like Elon Musk himself, tend to dream big, have nothing to lose, and can go the distance. For those of us from Greece or other smaller markets, that’s an inspiring example.

Some suggest that a SpaceX at that valuation might absorb so much public market capital that it harms companies launching afterward. Is that a real concern?

AS: You can view most things optimistically or pessimistically and make strong arguments for either side. A company like SpaceX, on a macro level, will ultimately bring more people into the market than the temporary impact of absorbing some liquidity. Consumer participation in markets has exploded over the last 30 years—from something nonexistent to people trading on their phones daily. Those numbers add up.

BB: SpaceX is a one-of-a-kind company. For a long time, space was a government and public sector domain. Giving investors genuine financial access to it will capture widespread imagination. It might shift some long-term allocations away from the next 20 or 30 software businesses, but the interest it generates more than compensates.

Is the current flood of capital into AI justified by future earnings, or is it extreme FOMO?

NB: If you’re an AI-native founder or a company in the American dynamism space, you can live life in the fast lane. If you’re not in one of those buckets, it’s tough. In my 17 years in Silicon Valley, I’ve never seen more groupthink. Three-quarters of all venture capital raised in the past year went to just five companies. Today, if you’re a 40-year-old tenured Stanford professor not building something in AI, no one wants to meet you. That said, something real is shifting. Two founders with today’s AI tools can make more progress in two months with one funding round than they could a year ago with 10 people, two rounds, and a full year. This is changing how companies start and capitalize themselves—potentially going straight from pre-seed to Series B.

AS: There will be a correction that pushes some capital out of the market. The promise and optimism still outpace the short- to medium-term ability to show results. But on a long-term, macro scale, I don’t think we’re being over-optimistic. However, that shouldn’t be mistaken for thinking every 19-year-old with an idea is the next big thing.

How do you price deals when things are moving this fast?

BB: The best founders have no shortage of capital options. You have to consider what’s a meaningful ownership stake for your fund and walk away when you can’t get there. The interesting dynamic is that we’re a $500 million fund competing with people investing from $10 billion or $15 billion funds. The incremental value of a dollar to us versus them is very different. That distorts round sizes and makes it hard for offers to stack up equally.

NB: We do first-money investing—essentially replacing friends and family or angel rounds. We invest in what I call “freaks”—individuals who, like in professional sports, break all the records. They learn and mature in one day, making progress that takes the average smart founder a whole week. Most founders we’ve backed are working on markets that don’t yet have a name, which is why valuations are low. Larger asset managers can’t tell their teams to find companies in a market that doesn’t exist yet.

There’s talk about very young founders getting term sheets almost on arrival. Is age really a proxy for anything meaningful right now?

AS: During times of disruption, when the world seems to be changing fundamentally, it favors lack of experience. Experience can actually mislead you. That doesn’t mean it’s permanent—we’re in a phase where things haven’t settled, creating fertile ground for new ideas, often from younger entrepreneurs. But I don’t want to over-generalize.

NB: The same thing was happening when I arrived as a grad student at Stanford in 2009. The iPhone was two years old, the App Store was one year old, and there were days when more VCs were on campus than students. Today is another such moment. If you’re 22 in San Francisco building something in AI, there might be a seed term sheet in your inbox—but if you’re 19, oh my God, that means you’re really good (laughs); you might already have a Series A offer. And age is relative—I was talking to a 24-year-old founder in Athens this week, and when I said he wasn’t that young, I meant it: I met the Mercor kids when they were 19, and look where they are now.

BB: If you try to generalize just from age, you miss what you’re really looking for: an extremely high level of intensity, the ability to move ahead of the market’s pace, and the mental dexterity to adapt in a constantly changing landscape. If you have those traits, they matter more than the age on your passport.

What do you make of shady behavior around metrics—particularly how companies report ARR (annualized recurring revenue)?

BB: People are being relatively liberal with how they define the A, the R, and the R. New pricing models—like token-based billing or free tokens counted as revenue—create many ways to express these numbers. Our job as investors is to cut through that and make decisions based on actual truths. Is it fine from a marketing perspective? Probably. Is it fine for deciding which companies get capital? No. But sophisticated investors can generally see through it.

NB: Sometimes I get an email with a very high ARR number from a portfolio company I didn’t remember doing that well, so I contact the founder. The answer? It was 365 times what they made the day before because a campaign hit. I told him, can you please use a quarterly basis at least? Whenever a lot of money chases specific themes, some people develop a grifting mentality for short-term gain. In venture, you can only lose your money once on a bad investment, but the right one can return 100x—so you write off the bad actors and move on.

For aspiring founders in the audience, where do you see white space right now?

NB: Every VC firm used to have at least half its partners doing consumer internet investing. Today, maybe they have half a person—they’ve left the field. But one of the best AI companies of the last few years, OpenAI, became massive because of ChatGPT. Consumer is coming back, which sounds almost crazy. Those founders today have maybe five investors they can pitch for their first or second round. I think there’s also a new movement emerging that will help restore the American dream through new consumer fintech ideas.

BB: The opportunity of AI interacting with the physical world is orders of magnitude larger than what we’ve seen in workflow automation and digital processes. The physical world still shapes a large part of the economy. The bet on robotics in all its forms—not just humanoids doing backflips—remains one of the biggest open spaces over the next decade.

If you want to learn more about what these three think—including whether Stanford University has grown too cozy with the venture capital industry—you can watch the full conversation below: