Anthropic Backer G Squared Raises $2.3 Billion for Seventh Fund

0el{]pgplu7fbh(l43q}w)g8_media_dl_1.png Bloomberg

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(Bloomberg) — G Squared raised $2.3 billion for its seventh flagship fund targeting investments in growth-stage technology firms, as founder Larry Aschebrook predicts a coming reset in valuations.

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The firm has started building out the fund with stakes in companies including Anthropic PBC, Polymarket, Mercor and Nscale, it said. G Squared has invested in more than 170 portfolio companies since its founding in 2011.

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Aschebrook sees the latest haul as building up a war chest to take advantage of a potential pullback across private company valuations in the final months of this year and the start of 2027, when he believes interest rates will go up, he said in an interview.

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“We think there is some settling that will come in multiples, and we need to have the dry powder to take advantage of that versus chasing every hot AI name,” Aschebrook said.

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The fund will target a rapidly growing private secondaries market which reached $240 billion in deals last year, according to data from Jefferies Financial Group Inc., as companies stay private for longer. SpaceX’s record-setting initial public offering, at a valuation far above where it had raised funds privately for more than a decade, delivered outsize returns to tech investors.

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G Squared’s sixth fund has stakes in Claude chatbot maker Anthropic, Fanatics and Physical Intelligence. It also owned shares of Wiz, which was acquired by Alphabet Inc. in a $32 billion deal completed earlier this year, and X-Energy Inc. which went public in April but has fallen 19% from its debut.

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G Squared backed Polymarket in a roughly $1 billion round completed in April at a $15 billion valuation, Bloomberg News has reported.

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Aschebrook argues that the market has become overheated. His competitors are “chasing every hot AI name” which has driven valuations to become expensive, he said.

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There were 945 active, privately owned companies with valuations of at least $1 billion as of the second quarter, with an aggregate value of $5.3 trillion, data from PitchBook show.

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The technology investor expects companies to continue staying private for longer unless they have cash needs, and sees the secondary market providing an opportunity for long-term investors to sell stakes. Investors are “starved for liquidity” beyond blockbuster deals like SpaceX, Aschebrook said.

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“When you see secondary and primary valuations converge, like is common now, that’s a leading indicator that the market is too hot and we need to slow deployment,” Aschebrook said. That means the firm plans to slowly add to positions or build on new stakes, ahead of what he sees as a needed cooling off.

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“It’s time to chill out a bit and we’ll definitely do that,” he said. “We’ll slow deployment, pick our spots and wait for the correction — which we think is coming.”

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