World-leading Tier 1 Venture Capital

There is a way to most accurately predict the future of the technology industry: look at where Tier 1 venture capital (VC) firms are investing. Sequoia Capital, Andreessen Horowitz (a16z), Benchmark, Kleiner Perkins, Founders Fund — these names are etched into every inflection point of the technology revolutions of the past 50 years. Apple, Google, Facebook, Airbnb, Stripe, and now Anthropic and OpenAI. The domains where Tier 1 VCs placed their bets a few years ago have, almost without exception, become the main battlegrounds of industry a few years later. In 2025, AI companies captured $258.7 billion (approximately ¥38.8 trillion) — 61% of global VC funding (as reported by the OECD) — and by Q1 2026, AI had come to account for 80% ($242 billion, approximately ¥36.3 trillion) of all global VC investment. The majority of this capital is being moved by Tier 1 VCs. The top 12 firms alone captured over 50% of capital raised in the first half of 2025, with the top 30 accounting for 74%. Their investment decisions are not mere financial transactions. They are the act of drawing the technology map of the next decade. In this piece, we take a comprehensive look at ten firms — Sequoia, a16z, Benchmark, Accel, Kleiner Perkins, Founders Fund, Lightspeed, General Catalyst, Greylock, and Index Ventures — examining each firm's areas of strength, focus sectors, investment philosophy, and the vision of the future they are collectively shaping.

What Are Tier 1 VCs — And Why Their Moves Reflect the Future of the World

The world of venture capital has a clear hierarchy. The top firms, known as "Tier 1 VCs," are not simply distinguished by the size of their capital. They function as a "quality certificate" for entrepreneurs, and their investments serve as a powerful signal to other investors, customers, and prospective hires.

The definition of a Tier 1 VC is not strict, but they share the following characteristics. First, they have a track record of more than $5 billion in exits (IPOs or acquisitions) over the past decade. Second, due to brand and network effects, they are the first call the best entrepreneurs make. Third, they can provide a strategic support network in debt financing, legal matters, and recruiting.

According to an analysis by the Ontario Teachers' Pension Plan (OTPP), startups backed by Tier 1 VCs have a 40% higher survival rate and are more than three times as likely to reach an IPO compared to those that are not. This is not simply the effect of "capital," but the combined result of network, knowledge, and brand halo effects.

Why does following their investments amount to predicting the future? The answer is simple. Tier 1 VCs are positioned where the world's information is most concentrated. They receive thousands of pitches per year, interact daily with cutting-edge researchers and entrepreneurs, and stand at the forefront of technology. Moreover, because they deploy their own capital over a long horizon of five to ten years, they bet on structural change rather than short-term trends. When a16z invested in Instagram in 2012, they were convinced that the era of mobile-first was coming. When Founders Fund made an additional investment in SpaceX in 2015, they had their eyes on the privatization of the space industry. When Sequoia invested in Anthropic in 2022, the contours of the AGI race were already visible to them. Following their investment decisions is nothing less than reading the industrial landscape three to five years into the future.

Sequoia Capital: A Half-Century Empire

Origins and Evolution

Sequoia Capital was founded in Menlo Park in 1972 by Don Valentine. The initial investment amounts were remarkably small — a 1975 investment in Atari, and a $150,000 stake in Apple in 1978. Yet its eye for talent was exceptional from the very beginning.

Today's Sequoia split in 2024 into three separate entities: the US/Europe entity (Sequoia Capital), China (HongShan), and India/Southeast Asia (Peak XV Partners, formerly Sequoia India, with $9 billion AUM). The US/European Sequoia Capital manages approximately $56 billion in assets (as of January 2025) and employs 140 people, including 92 partners.

In November 2025, Alfred Lin and Pat Grady succeeded Roelof Botha as co-managing partners (or "stewards"). Grady has said "consensus doesn't matter — conviction does," while Lin has noted that "holding ideas in a state of extreme tension is the path to truth."

Legendary Returns

Sequoia's portfolio reads like the history of the technology industry itself: Apple, Oracle, Cisco, Google, YouTube (acquired by Google for $1.65 billion against Sequoia's $11.5 million investment), WhatsApp (acquired by Facebook for $19 billion, generating approximately $3 billion in returns against Sequoia's cumulative investment of roughly $60 million), NVIDIA, Airbnb, and Stripe (valued at $70 billion).

Then in 2026, Sequoia led a landmark round for Anthropic, bringing the company's valuation to $350 billion. It is the firm's biggest bet yet on the foundational layer of AI.

Current Focus Areas

Sequoia made 126 investments in 2025 and 33 through March 2026. Recent highlights include Harvey AI (legal AI, valued at $11 billion on a $200 million raise), Rox AI (valued at $1.2 billion), and Perplexity ($210 million Series B at a $3.5 billion valuation). Under the Grady–Lin leadership, the firm's concentration in the AI sector continues to accelerate.

Andreessen Horowitz (a16z) — From "Software is eating the world" to "AI is eating the software"

Founding and Vision

a16z was founded on July 6, 2009, by Marc Andreessen (co-founder of Mosaic/Netscape) and Ben Horowitz (co-founder of Opsware). Before its founding, between 2006 and 2010, they invested approximately $4 million in 45 companies as "super angels," generating hits including Twitter.

Andreessen's 2011 essay "Why Software Is Eating the World" became a manifesto for the technology industry. As of 2026, that thesis has evolved into "AI is eating software." Steven Sinofsky (a16z) notes: "AI changes what we build and who builds it, but not how much needs to be built. We need far more software, not less."

Largest War Chest in History

a16z's assets under management surged from $46 billion in July 2025 to over $90 billion in March 2026. The decisive moment was a major $15 billion fundraise in January 2026.

The $15 billion is divided across five funds: $3.5 billion for AI applications, $1.7 billion for AI infrastructure, $5 billion for late-stage venture, and $2.5 billion for American Dynamism (defense and infrastructure). This raise represents 18% of all VC capital deployed across the United States in 2025.

Investment Thesis

a16z's current investment focus spans nine sectors: AI, bio/healthcare, consumer, crypto, enterprise, fintech, gaming, infrastructure, and American Dynamism. The firm executed 182 investments in 2025 and 41 through March 2026, with a track record of 35 IPOs and 247 acquisition exits.

Recent highlights include Navan (listed on NASDAQ in October 2025 with a market cap of $5.82 billion), Figma (listed on the NYSE with a market cap of $13.5 billion), and Wiz (exited in March 2026).

Benchmark――The Aesthetics of Equal Partnership

Benchmark was founded in 1995 and operates with one of the most unique organizational structures in the VC industry. Five to six general partners split management fees and carried interest completely equally. There are no "juniors" or "seniors." There is no CEO. It was the first VC firm to adopt this structure.

Fund size is intentionally capped at approximately $500 million. The debut fund in 1995 was $85 million and generated a 90x return through its investment in eBay. Benchmark invested $6.7 million in eBay for a 22.1% stake (1997). It invested $12 million in Uber for an 11% stake (2011), which was valued at $7 billion at the 2019 IPO and $9.4 billion in 2023.

The first eight funds (1995–2019) recorded a net return of 7.5x after fees and carry. Even in the age of AI, Benchmark continues to resist expanding its team or inflating its fund size, maintaining disciplined, selective investing.

Kleiner Perkins — The AI Pivot of Revival

Kleiner Perkins was founded in 1972 by Eugene Kleiner (formerly of Fairchild Semiconductor) and Tom Perkins (formerly of HP). John Doerr (a former Intel salesman who joined in 1980) led investments in Netscape, Amazon, and Google, generating legendary returns.

During the "Cleantech Pivot" of 2004–2009, Doerr spearheaded investments of $630 million across 54 companies, but this was widely regarded as a failure and even called the firm's survival into question.

However, following Mamoon Hamid's arrival in 2017, the firm successfully rebuilt itself. In March 2026, it raised $3.5 billion, comprising KP22 (an early-stage fund of $1 billion) and a growth fund of $2.5 billion. Under the Hamid-Fushman leadership, the firm has raised a cumulative total of over $6 billion.

Focus areas include AI-driven professional services, healthcare, autonomous driving, cybersecurity, financial services, productivity tools, and industrial applications. The portfolio includes Google, Amazon, Waymo (which participated in a $16 billion round in February 2026), Anthropic, SpaceX, Harvey, Glean, and Rippling.

Founders Fund — Peter Thiel's Contrarian Philosophy

"Zero to One" in Practice

Founders Fund was established in early 2005 by Peter Thiel, Ken Howery, and Luke Nossek with an initial fund of $50 million. Thiel's investment philosophy is distilled in his book *Zero to One*: "The most valuable businesses dominate markets where there is little competition," "You must have a product that is 10x better," and "The best startups are built on important truths (secrets) that only a few people know."

Assets under management stand at approximately $17 billion (2025). The 2025 Growth Fund III targets $4.6 billion, with the upcoming Growth Fund IV targeting $6 billion.

The Defense Tech Empire

Founders Fund's most defining characteristic is its deep lean into defense technology. This includes Palantir (its first institutional investor, with an 18.5x return and $3.1 billion in distributions), SpaceX (invested since 2008, with an unrealized position value of $18.2–$19.5 billion — exceeding the firm's total AUM), and Anduril (which raised $2.5 billion in a Series G in June 2025, with Founders Fund contributing $1 billion as a sole lead investor, at a valuation of $30.5 billion).

Additionally, partner Scott Nolan co-founded nuclear fuel startup General Matter, which is positioned as the third installment in a "trilogy" following Palantir and Anduril.

Lightspeed Venture Partners――At the Forefront of AI Investment

Lightspeed Venture Partners was founded in 2000 and manages over $40 billion in assets under management (approximately ¥6 trillion). In December 2025, it raised a record $9 billion (approximately ¥1.35 trillion) across six vehicles.

Particularly notable is the scale of its AI investments. It has deployed $5.5 billion (approximately ¥825 billion) into more than 165 AI-native startups. The portfolio includes Anthropic, Anduril, Databricks, Glean, Mistral, Rubrik, Wiz, and Navan.

Among its legendary returns: Snap/Snapchat (as the first external investor in 2012, it invested a $485,000 seed round (approximately ¥72.75 million), with total investment including follow-ons reaching $8.1 million; at the 2017 IPO with a $24 billion valuation (approximately ¥3.6 trillion), this yielded a return of over 250x, worth more than $2 billion (approximately ¥300 billion)). Also included are Nest (acquired by Google for $3.2 billion (approximately ¥480 billion)) and Affirm (valued at $30 billion (approximately ¥4.5 trillion) at IPO).

General Catalyst — "Resilience Through AI"

General Catalyst was founded in Massachusetts in 2000 and expanded rapidly under Hemant Taneja (five MIT degrees, CEO since 2021). Assets under management grew from approximately $18 billion (around ¥2.7 trillion) in 2021 to over $40 billion (around ¥6 trillion) by summer 2025. In October 2024, the firm raised $8 billion (around ¥1.2 trillion), with a target of $10 billion (around ¥1.5 trillion) for its next fund.

Taneja has said, "Bubbles are good because they mobilize capital and talent toward new vectors of innovation," positioning AI as "an engine of abundance and resilience." He has pledged $5 billion (around ¥750 billion) in investments in India over five years. In the UK, the firm launched a medtech fund (£30 million, approximately ¥5.7 billion) targeting the NHS.

The portfolio spans over 800 companies, including Airbnb, Anduril, Anthropic, Canva, Glean, HubSpot, Ramp, Stripe, Mistral, Helsing, and Deliveroo.

Greylock Partners――60 Years of Wisdom

Greylock is one of the oldest VC firms in the United States, founded in Cambridge, Massachusetts in 1965. Its initial capital was $10 million from six families. Its current assets under management exceed $3.5 billion. In October 2023, it formed Fund XVII at $1 billion.

LinkedIn co-founder Reid Hoffman serves as a partner. The firm was an early investor in LinkedIn, Facebook, Airbnb, Dropbox, Discord, Palo Alto Networks, Workday, Figma, Roblox, and Coinbase.

Partner David Sze has stated regarding AI: "Fewer than ten players have the capability and capital to build foundation models, but we are still far from the endpoint of scaling returns," and is closely watching the accuracy and reliability gap in enterprise AI as a future investment opportunity.

Index Ventures — From Europe to the World

Index Ventures was founded in Geneva in 1996 and relocated its headquarters to London in 2002. It opened its San Francisco office in 2012, becoming the first Europe-originated VC to establish a global Tier 1 status.

In 2024, it raised a new fund of $2.3 billion (approximately ¥345 billion). Its portfolio includes 662 companies, of which 65 are unicorns. Notable investments include Figma (a seed investment of $1.8 million in 2013, with cumulative investment of $86.5 million, a market cap of $13.5 billion at IPO, and a return of approximately 1,300%), Roblox, Revolut, Adyen, Datadog, Dropbox, Etsy, Discord, Slack, and Robinhood. Bloomberg has reported a return of 1,100% for its most recent fund.

Tectonic Shifts in Global VC Funding

From 2023 to 2026, global VC funding flows changed dramatically.

In 2023, total global VC investment reached $349.4 billion (approximately ¥52.4 trillion), with AI accounting for 7% of that. In 2024, this grew to $368.3 billion (approximately ¥55.2 trillion), though deal count fell to 35,685 — the lowest in seven years. In 2025, the figure reached $425.0 billion (approximately ¥63.8 trillion), with AI companies capturing 61% of the total ($258.7 billion, or approximately ¥38.8 trillion). Then in Q1 2026 alone, $297.0 billion (approximately ¥44.6 trillion) was recorded, surpassing the full-year totals of every year prior to 2019 in a single quarter.

Of that Q1 figure, 80% — or $242.0 billion (approximately ¥36.3 trillion) — flowed into AI companies. Just four companies accounted for $188.0 billion (approximately ¥28.2 trillion), or 65% of the entire quarter: OpenAI ($122.0 billion = approximately ¥18.3 trillion, valuation $852.0 billion = approximately ¥127.8 trillion), Anthropic ($30.0 billion = approximately ¥4.5 trillion, valuation $380.0 billion = approximately ¥57.0 trillion), xAI ($20.0 billion = approximately ¥3.0 trillion), and Waymo ($16.0 billion = approximately ¥2.4 trillion).

By sector, healthcare/biotech held steady at 14.3%, while fintech and hardware/quantum computing also maintained a notable presence. Crypto/blockchain recorded $4.8 billion (approximately ¥720 billion) in Q1 2025 alone, marking its strongest quarter since the second half of 2022. Defense tech is a rapidly growing sector, exemplified by Founders Fund's investment in Anduril.

Comparison with Japan's VC Environment

Japan's VC market is structurally different from Silicon Valley. The SoftBank Vision Fund is the world's largest tech investment fund with $166 billion in assets under management (approximately ¥24.9 trillion, as of 2025), but its performance has fluctuated significantly — Vision Fund 1 ($100 billion) recorded a gross profit of $22.6 billion, while Vision Fund 2 posted a loss of $21 billion.

Startup fundraising in Japan grew approximately tenfold between 2013 and 2022, yet in absolute terms it remains far below Silicon Valley levels. While U.S. VCs deployed over $26 billion in the first half of 2025 alone, Japan's VC investment volume represents only a fraction of that. Key characteristics of the Japanese market include lengthy decision-making processes, meticulous due diligence, and the dominance of funds affiliated with financial institutions. However, the pace of international VC firms establishing Japanese offices accelerated in 2023–2024, driving greater internationalization of the ecosystem.

The Future Envisioned by VCs — Expert Perspectives

AI Dominance Continues, but Challenges Emerge

Brad Conger (CIO of Hirtle Callaghan) notes the concentration of capital flowing into AI, saying "thematic concentration in VC portfolios has never been this high." Abby Meyers of Bain Capital Ventures predicts accelerating enterprise AI adoption, stating "2026 is when large companies will start moving in earnest with AI." Scott Beechuk, VP at Norwest, summarizes: "If last year was about building AI infrastructure, 2026 is the year we find out whether the application layer can turn that investment into real value."

Meanwhile, MIT research reports that despite $30–40 billion (approximately ¥4.5–6 trillion) being poured into enterprise GenAI, 95% of organizations are seeing zero return — keeping concerns about an "AI bubble" very much alive. Big Tech's AI capex is projected to exceed $650–700 billion (approximately ¥97.5–105 trillion) in 2026.

Positive Structural Shifts

Nevertheless, the VC consensus is leaning toward "this is not a bubble, but an early stage of infrastructure investment." As General Catalyst's Taneja puts it, "a bubble can be a good thing" — because excess capital deployment ultimately accelerates technological breakthroughs and the construction of industrial foundations.

The following developments are specifically anticipated:

In the second half of 2026, AI agents will begin genuinely replacing enterprise business processes. Harvey AI, a Sequoia portfolio company, is redefining industry standards in the legal field, while Promptfoo (acquired by OpenAI), backed by a16z, is doing the same in AI evaluation.

By 2027, the defense tech and space tech market that Founders Fund is betting on is expected to reach $100 billion (approximately ¥15 trillion). Anduril's valuation of $30.5 billion has surged 3.6x from just $8.5 billion three years ago.

By 2028, autonomous driving technology — exemplified by Waymo, a Kleiner Perkins portfolio company — could be in commercial operation in more than 20 major cities. Open-source AI, symbolized by Lightspeed-backed Mistral, is becoming an important counterweight to the OpenAI/Anthropic duopoly.

Looking toward 2030, the accuracy and reliability gap in enterprise AI that Greylock is watching closely will close, and AI adoption in mission-critical operations will become standard. The European tech ecosystem, bridged by Index Ventures, will convert its regulatory strengths (the EU AI Act, first-mover experience with GDPR) into competitive advantage in AI governance.

What the investment patterns of Tier 1 VCs reveal is a conviction that AI is not merely a technology trend, but a "General Purpose Technology (GPT)" that is restructuring industry itself. Just as electricity and the internet did before it, AI infrastructure investment may look excessive at first, but will fundamentally raise societal productivity over the long term. Tier 1 VCs are committing capital in the trillions of yen behind that conviction. That is why we track where it goes.

References

OECD (2026/2). "AI firms capture 61% of global venture capital in 2025."
Crunchbase (2026/4). "Record-Breaking Funding: AI Global Q1 2026."
Fortune (2025/11/5). "Meet Sequoia Capital's New Stewards."
TechCrunch (2026/1/9). "The Venture Firm That Ate Silicon Valley" (a16z).
Bloomberg (2026/3/24). "Kleiner Perkins Raises $3.5 Billion to Invest in the AI Boom."
TechCrunch (2025/6/5). "Anduril Raises $2.5B at $30.5B Valuation Led by Founders Fund."
BusinessWire (2025/12/15). "Lightspeed Raises Record $9B in Fresh Capital."
Benzinga (2026/3). "General Catalyst Eyes $10B Funding Effort."
Carta (2025/Q4). "VC Fund Performance Q4 2025."
Ontario Teachers' Pension Plan. "Tier 1 VC Investors Help Startups Navigate Market Volatility."
Harvard Law School Forum on Corporate Governance (2025/12). "Venture Capital Outlook for 2026."