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Investors are racing to meet artificial-intelligence companies' massive capital needs, writing larger checks to fewer startups. Megadeals, or rounds of at least $100 million, made up a whopping 87.5% of U.S. venture capital deployed in the first half of 2026, according to PitchBook .
But some family offices are bucking the trend, seeking outsized returns from smaller bets on younger companies.
"I think there's a big misconception that writing large checks into these late-stage rounds de-risks investments," said Jason Blanck, an investor who started his namesake family office in 2024. "In reality, they're paying essentially peak market multiples and slower growth, so they're not really getting much upside."
For family offices that invest for generations, waiting longer for a larger relative return on investment is worth it, according to John Morrissey, managing director of Shea Ventures. The Shea family, whose construction company helped build the Golden Gate Bridge and the Hoover Dam, has invested in venture capital since the late 1960s.
"Our goal is to sustain our wealth and to grow it tax efficiently and generationally," Morrissey said. "If I have one investment that can continue to compound in the double digits, that's almost inevitably better than something invested for a short period with a very high return and sends me back the money. Then I have to go try to find something else."
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He looks for funds with limited partners who, like Shea Ventures, prioritize the investment multiple over the internal rate of return. Large institutional investors and sovereign wealth funds, on the other hand, often want capital returned sooner and have different tax considerations, according to Morrissey. He added that they can typically afford to make bigger allocations to one round or asset class than most family offices.
"Family offices like those of David Rubenstein or Josh Harris, those are the exception. Most family offices may have a couple of billion dollars, and maybe you have an operating business that you've got to feed," Morrissey said. "You're never going to be able to participate at the same level as Yale's endowment."
He also views early-stage funds as more closely aligned with the family office's investment goals. Managers investing in late-stage mega rounds can earn substantial carry by securing access and riding a company's momentum. Funds that invest in smaller firms, he said, need their investments to grow at much higher multiples to earn that incentive income.
Shea Ventures backs startups through direct investments and funds such as Shakti. The five-year-old fund backs startups at inception, sometimes before they even have a product or revenue.
"There are healthy, meaning low, valuations available if one is willing to be unconventional and not afraid to not be part of the herd," said Shakti partner and founder Keval Desai.
Shakti backs AI-related startups but finds attractive entry points by looking for less crowded niches, Desai said. For instance, the fund's portfolio includes two robotics companies that collect garbage, with one focused on space.
Shea Ventures and Blanck Capital both balance their risk by also investing in growth equity. Blanck describes it as a barbell approach, with venture assets like direct early-stage investments and secondaries making up a minority of the portfolio, alongside a core base of public equities.
He has invested in Anthropic but is more excited to talk about less buzzy startups in his portfolio like Longshot Space Technology, which is building what the company calls a "space gun" to shoot payloads into orbit. Blanck Capital has backed Longshot since its pre-seed round in 2023, and it has since secured contracts with the U.S. Air Force, DARPA and the U.S. Navy.
"I'm invested in Anthropic, but it doesn't mean it's going to be the best investment of my year or portfolio," Blanck said. "It might be the most popular, or might get the most attention with other investors or friends and industry folks, but it's not moving the needle for me, let me just put it that way."
