IPO Watch
Week of September 1st, 2025
Welcome to AI8’s weekly newsletter, your ultimate source for curated insights and updates from the dynamic world of venture capital!
We’ve scoured the vast landscape of the web to bring you a comprehensive roundup of the industry’s top news articles, all in one convenient place. We keep you ahead of the game and in the know about all things related to the vibrant world of investments
STARTUPS
ROUNDS AND UNICORNS
The Week’s 10 Biggest Funding Rounds: Commonwealth Fusion’s Giant Financing Leads Otherwise Slow Week For Big Deals (Crunchbase, 5 minute read)
Commonwealth Fusion Systems (Fusion Energy): Raised $863M Series B2, backed by Nvidia’s NVentures and others. The Massachusetts-based company is advancing toward the world’s first commercial fusion power system
Wugen (Oncology): Secured $115M equity financing led by Fidelity. The St. Louis startup develops CAR-T therapies for T-cell cancers and will use the capital to expand clinical trials
Rain (Fintech): Closed a $58M Series B led by Sapphire Ventures, just five months after its Series A. The New York firm builds stablecoin payments infrastructure and has now raised $88.5M in total
Blue Water Autonomy (Autonomous Ships): Landed $50M Series A led by Google’s GV. The Boston company designs unmanned naval ships and will launch its first long-range vessel in 2026
Assort Health (Healthcare AI): Raised about $50M Series B at a $750M valuation. The San Francisco startup provides AI-powered patient communication tools for specialty healthcare providers
As venture debt gambles on GPUs, not all are sold on silicon-backed loans (Pitchbook, 4 minute read)
Venture-backed startups are increasingly using GPUs -graphics processing units, chips originally designed for rendering graphics but now essential for training and running AI models- as collateral to secure loans for building massive AI data centers. This financing model is risky because GPUs depreciate quickly, with new models often outpacing the old within a year or two. Nvidia’s GPUs in particular have become some of the most sought-after tech assets, a single Nvidia H100 can cost $25,000–$40,000 on secondary markets
Large AI infrastructure firms like Lambda, Crusoe, and CoreWeave have taken on billions in GPU-backed debt to fund expansion
Major private credit firms such as BlackRock, JPMorgan, and Carlyle have also piled into issuing GPU-backed loans
GPU values swing sharply, but despite the risks, lenders expect GPU-backed financing to persist as long as AI demand remains high
Nvidia says two mystery customers accounted for 39% of Q2 revenue (TechCrunch, 2 minute read)
Nvidia reported record Q2 revenue of $46.7 billion, up 56% year-over-year on surging AI data center demand. But nearly 40% of sales came from just two customers: one representing 23% of revenue and another 16%. The company did not disclose their names, identifying them only as “Customer A” and “Customer B”
Overall, data centers accounted for 88% of Nvidia’s revenue, with large cloud service providers contributing roughly half of that
Analysts note that reliance on a small group of buyers poses concentration risk
However, these customers have significant cash reserves and are expected to continue heavy spending on AI infrastructure
Cracks are forming in Meta’s partnership with Scale AI (TechCrunch, 3 minute read)
Meta’s $14.3 billion investment in Scale AI, announced in June to power its new Meta Superintelligence Labs (MSL), is already showing tension. One senior Scale executive, Ruben Mayer, left Meta after just two months, while reports suggest researchers at MSL prefer rival data-labeling vendors Surge and Mercor, citing higher-quality datasets. Scale, long reliant on crowdsourced data, has struggled as AI models demand specialized expertise, and in July the company laid off 200 employees after losing Google and OpenAI as clients
Meta’s partnership with Scale was partly seen as a way to bring CEO Alexandr Wang and his AI network into the company
However, integration challenges are emerging: several Scale hires aren’t working in MSL’s core AI unit, and frustrations with Meta’s bureaucracy have prompted some former OpenAI recruits and veteran Meta staff to quit
Meanwhile, Meta is doubling down on AI expansion with acquisitions (Play AI, WaveForms AI) and infrastructure projects, including a $50B U.S. data center named Hyperion
ECONOMIC SNAPSHOT
US court rules many of Trump's global tariffs are illegal (BBC, 3 minute read)
A U.S. appeals court has ruled that most of President Trump’s tariffs are “invalid as contrary to law,” striking down his 10% global tariffs and “reciprocal” levies imposed on dozens of countries, as well as targeted tariffs on Canada, Mexico, and China. In a 7–4 decision, the Court of Appeals for the Federal Circuit said Trump exceeded his authority under the International Emergency Economic Powers Act (IEEPA), which does not mention tariffs and reserves that power for Congress
The ruling follows two lawsuits brought by small businesses and a coalition of U.S. states, challenging Trump’s May executive orders that declared a national trade emergency and imposed sweeping tariffs
The decision will take effect on October 14, 2025, unless overturned by the Supreme Court
Importantly, the ruling does not apply to tariffs imposed under other authorities, such as Trump’s 50% tariffs on steel and aluminum imports, which remain in place
US economy grows 3.3% in second quarter, government says, in second estimate of April-June growth (AP, 3 minute read)
The U.S. economy grew at a 3.3% annual rate in Q2 2025, rebounding from a 0.5% contraction in Q1, according to revised Commerce Department data. The first-quarter decline, the first in three years, was driven by a surge in imports ahead of Trump’s new tariffs. Imports then fell 29.8% in Q2, adding over five percentage points to GDP growth. Consumer spending, which makes up 70% of GDP, rose 1.6%, up from 0.5% in Q1
Private investment, however, plunged 13.8%, the steepest drop since 2020, with reduced inventories cutting 3.3 percentage points from growth
Despite the rebound, economists warn Trump’s sweeping tariffs — imposed on nearly all trading partners — raise costs and create uncertainty, potentially dampening long-term growth
While the job market remains resilient, analysts expect the economy to slow to about 1.5% growth as tariffs filter through to consumer prices
US Fed loss of independence a serious danger, says Lagarde (BBC, 2 minute read)
European Central Bank President Christine Lagarde warned that if President Trump were to undermine the independence of the U.S. Federal Reserve, it would pose a “very serious danger” to both the U.S. and global economy. Speaking to Radio Classique, Lagarde said that political control over U.S. monetary policy would be “very worrying” given the Fed’s central role in managing inflation and employment. Since returning to office, Trump has repeatedly attacked Fed Chair Jerome Powell and recently attempted to remove Fed Governor Lisa Cook—a move now being challenged in court
Trump has pressed for steep interest rate cuts, pushing the Fed’s current 4.25%–4.5% target rate down to below 1%, despite concerns that his tariffs could fuel inflation
Lagarde emphasized that it would be difficult in practice for Trump to seize control, as Fed governors can only be dismissed for gross misconduct
Rate decisions are also made collectively by the seven-member board and regional Fed presidents
IPO & EXITS
Bigger Outcomes As Startup Exits Gain Steam In 2025 (Crunchbase, 3 minute read)
The U.S. venture market is seeing a notable rebound in billion-dollar startup exits through IPOs and M&A after more than three years of muted activity. By mid-August 2025, 13 U.S. venture-backed companies went public at a combined IPO value of $86 billion, compared to eight listings worth $56.5 billion in 2024. High-profile debuts like Figma, Circle, CoreWeave, and Chime have fueled confidence, with investors especially focused on AI-driven growth stories
M&A has also surged, with $84 billion across 22 deals so far this year, up sharply from $38 billion in 2024 and surpassing the previous six-year peak of $68 billion in 2021
While IPO levels remain below pre-2020 norms, market sentiment is improving
Analysts point to AI innovation, cheaper public capital, and stronger fundamentals as key drivers
Tech IPO Darlings Give Up Some Gains (Crunchbase, 2 minute read)
High-profile IPOs from Figma, Circle, CoreWeave, and Chime initially drove optimism that the tech IPO window had reopened, but shares have since pulled back from summer highs. Figma, which briefly hit a market cap near $70 billion after tripling on debut, has fallen nearly 50% from its peak, while Circle has also lost close to half its value after a sharp post-IPO rally. CoreWeave remains above its IPO price despite declines, and Chime, which rose 37% at listing, now trades below that level
Analysts caution that these declines reflect the unwinding of momentum-driven gains rather than a broader downturn, with IPO valuations still elevated compared to listing prices
The pipeline of offerings is expected to remain active unless corrections deepen
What to Expect From the Next IPOs (Investopedia, 4 minute read)
While market indexes sit near record highs and some valuations invite dotcom-bubble comparisons, IPO pricing has been more modest, with investors far choosier than during the exuberance of 2020–2021. Of the seven tech unicorns that went public in 2025, five are listed below their peak private valuations. Only Figma (FIG) and Firefly Aerospace (FLY) bucked the trend. Still, IPOs this year are stronger financially
The median IPO valuation was 25% above peak private value, compared with just 3% in 2024 and the 100%+ premiums common in 2020–2021
The average revenue for 2025 tech IPOs reached $831 million, with four surpassing $1 billion. Notably, a quarter of 2025 IPOs were profitable at listing, up from 12% in 2021
Analysts describe today’s IPO market as “highly selective and focused on strong financials rather than high-loss startups”, while offerings have been well received, overall VC exits remain muted, with a busier 2026 expected
Klarna IPO to Kick Off September Rush (Bloomberg, 3 minute read)
A wave of August IPO filings is setting up one of the busiest windows since late 2021. Klarna Group, which updated its SEC filing on Aug. 15, leads the pack and could list as early as September, alongside crypto exchange Gemini, blockchain lender Figure, and four others: Legence Corp. (Blackstone-backed HVAC), Black Rock Coffee Bar, and Via Transportation
If all six price offerings in the second week of September, it would be the first time since January that five U.S. IPOs raising $100M+ debut in a single week
The pipeline is crowded: JPMorgan is working with ~30 companies currently on file or testing investor demand
Additional candidates include Netskope (cybersecurity), Pattern Group (e-commerce), WaterBridge Infrastructure (Five Point-backed), and StubHub, all of which could launch roadshows as soon as Sept. 8
Chinese companies flock to US exchanges despite heightened tensions (Pitchbook, 3 minute read)
Chinese companies are increasingly listing on U.S. stock exchanges despite escalating political tensions and steep U.S. tariffs of around 55% on Chinese goods. In H1 2025, 258 companies from Greater China (including Hong Kong, Macau, and Taiwan) went public, with 22.5% of listings occurring in the U.S., up from 15.9% in 2024. At this pace, Chinese listings in the U.S. could hit a record high this year, with Nasdaq remaining the most popular exchange
While listing counts are rising, deal sizes are shrinking: 58 Chinese IPOs raised $11.2 billion in H1, less than half of 2024’s $23 billion
VC-backed IPOs show an even sharper drop—six listings worth just $1 billion in H1, compared to $11 billion across nine deals in 2024
Tighter IPO rules in mainland China since 2023, which raised financial thresholds, have made the U.S. and Hong Kong markets more attractive
WHAT A TIME TO BE ALIVE
Study Shows Female Entrepreneurs Penalized for Failure, While Men Often Benefit (Investopedia, 4 minute read)
A 2025 NBER study found that women face significant disadvantages in VC funding compared to their male cofounders—even when working on the same failed startups. After a failure, women were 30% less likely to get funding and, when funded, raised 53% less than men. Over five years, this translated into $31 million less capital on average. The bias persists even after success: women were 27% less likely to secure VC funding after a strong exit and raised $28 million less than their male counterparts. Meanwhile, men benefited from failure, raising 5% larger deal sizes afterward
Researchers concluded that these gaps cannot be explained by industry, experience, or track record, but rather by gender bias and stereotypes
Troublingly, failures by women founders also triggered smaller deals for other female entrepreneurs (6.7–7.5 percentage points less), showing negative spillover effects across the ecosystem
Despite raising less money, women-led startups had better success rates in subsequent ventures, suggesting investors are systematically undervaluing talented female founders, with broader costs to innovation and the economy
New study finds VCs responded to George Floyd’s death with ‘tokenism’ (San Francisco Examiner, 4 minute read)
A new study finds that while venture capital firms initially increased support for Black-founded startups after George Floyd’s murder in 2020, those gains have since reversed. In the year following Floyd’s death, Black-led startups were 22% more likely to receive funding than non-Black-led companies, with their share of deals rising to 4% and funding to 13.7%, compared to pre-2020 averages of 2.9% and 2.6%
By late 2022, funding momentum had faded, and by early 2024, Black-founded startups were less likely to attract capital than before 2020
Researchers argue the initial surge reflected reputational concerns and “tokenism” rather than a sustained commitment to systemic change
Much of the early increase came from firms with no prior history of investing in Black founders, who often made only one-time commitments and rarely took board seats
Diversity at the Fed took one step forward. Now Trump is taking it two steps back (CNN, 4 minute read)
The Federal Reserve, historically dominated by white men, had made strides in diversity under President Biden with the appointments of Adriana Kugler (the first Hispanic governor), Lisa Cook (the first Black woman), and Philip Jefferson. Those gains are now unraveling. President Trump removed Cook from the Board of Governors this week, citing unproven allegations of mortgage fraud — the first time a U.S. president has fired a Fed governor. Cook is suing to challenge her dismissal, calling the claims unfounded. Kugler also resigned earlier this month without explanation, leaving Jefferson as the only person of color on the board
Trump has nominated economic adviser Stephen Miran to replace Kugler, marking a shift in the board’s composition at a time when the Fed is grappling with economic disparities, including a sharp rise in Black unemployment
Experts warn that the loss of diversity could weaken the Fed’s ability to understand and respond to how policies affect different communities and could undermine public trust in the institution
Since its founding in 1913, only 12 women, five Black officials, and one Hispanic governor have served on the Fed’s board
8alpha.ai is an AI fintech transforming cash-generating businesses into scalable, AI-powered companies. We provide revenue-based financing and hands-on AI transformation, delivering no zeros with unlimited upside. We’re the architects building financial infrastructure for the next generation of investors and startups.
Become part of our revolution.
Happy reading,
8alpha.ai’s Research & Investment Team
