Disruptive Raises a $10 Billion Fund to Put Up to $1 Billion Each Into About 10 Late-Stage Tech Companies, Citing AI and Defense
Dallas-based investment firm Disruptive announced a $10 billion flagship fund on October 27 that it says will back approximately 10 growth and late-stage private technology companies with up to $1 billion each, pointing to AI, compute infrastructure and defense as the areas driving capital needs. TechCrunch, which describes the plan as at least 10 companies, reports that it is the firm's first blind-pool fund after years of deal-by-deal vehicles. The release does not name the fund's investors.
Disruptive is betting that the largest private technology companies of the AI era will keep needing checks of up to $1 billion, and it has raised a $10 billion fund to write about 10 of them, by its own account.
Ten bets of up to $1 billion#
Disruptive says the Disruptive Flagship Fund is a $10 billion fund designed to back category-leading private technology companies. It plans to back approximately 10 growth and late-stage companies, investing up to $1 billion per company. TechCrunch describes the same plan as backing at least 10 late-stage companies. The release says advances in AI, the buildout of compute infrastructure and new investment in defense and national security are increasing the capital such companies need.
Founder and CEO Alex Davis said in the release that the best private technology companies "are growing larger, staying private longer and requiring more capital than ever before."
A first blind pool after years of single-deal vehicles#
TechCrunch reports that this is technically the firm's first blind-pool fund, in which investors commit money without knowing which companies it will back; until now, it says, Disruptive raised money through deal-by-deal special purpose vehicles. TechCrunch says The Wall Street Journal reported earlier this month that the firm was seeking to raise the fund and had by then secured at least $7.5 billion in capital commitments. TechCrunch also cites Bloomberg reporting that Disruptive told its limited partners it has returned more than $6 billion on the roughly $1.9 billion it has put into startups. According to the Dallas Business Journal, as cited by TechCrunch, the new vehicle is the largest venture fund raised in Texas history.
Disruptive's release lists past and present portfolio companies including Airbnb, Databricks, ElevenLabs, Helsing, Groq, Palantir, Reflection AI, Spotify and Shield AI. The firm led Groq's $350 million Series A in August, and Groq's release identified Davis as both Groq's executive chairman and Disruptive's CEO.
Limits#
- Disruptive's release says the fund will back approximately 10 companies; TechCrunch says at least 10. We report the release's wording as the firm's plan.
- The $7.5 billion commitment figure, the returns figure and the Texas ranking reach us through TechCrunch's citations of the Wall Street Journal, Bloomberg and the Dallas Business Journal; we did not open those reports.
- The returns figure is what Disruptive told its investors, according to Bloomberg via TechCrunch, and is not audited performance data.
- The release does not name the fund's limited partners or say how many companies it has already identified.