Brainworks Ventures Unveils $50M AI-Native Fund to Rewrite the Economics of Venture Capital

With DARPA, NASA, and Silicon Valley roots and 80+ years of operating and investing experience, the firm’s founders say the old Silicon Valley playbook is obsolete as they aim to assist AI-native startups reach billion-dollar outcomes with a fraction of the capital and time.

SAN FRANCISCO--(BUSINESS WIRE)--Brainworks Ventures, AI-native venture capital fund led by DARPA alumnus Dr. Phillip Alvelda and a global team of veteran investors and innovators, today announced the launch of its $50 million fund specifically designed for what Managing Partner Dr. Phillip Alvelda calls "the new mathematics of AI-native companies." The fund is targeting a first close of $15 million by Q1 2026, with a target fund size of $50 million, scalable to $75 million.

The Company understands the venture capital playbook that has driven Silicon Valley for the past 20 years is broken and the transformation they’re betting on is exponential. Brainworks Ventures’ initial fund will focus on AI applications, infrastructure, and tooling, healthcare and life sciences, enterprise productivity, and education. With investment sizes ranging from $250,000 to $10 million and geographic reach across North America, Europe, and Asia-Pacific. Brainworks aims to capture the best AI-native founders wherever they're building.

“The old VC equation was straightforward: raise $150 million over 4-5 rounds of finance, hire 100 or more people, wait 12 years, and hope for a unicorn listing,” said Phillip Alvelda, Co-Founder and Managing Partner at Brainworks Ventures. “Now, old guard VCs are trying to bolt AI onto their portfolio companies’ existing legacy infrastructure. That's like adding a turbocharger to a horse-drawn carriage. That just isn’t going to be competitive with future AI-native companies. That’s why we’ve designed an investment and return model we know will work and scale companies at newly enabled AI-rates from day one.”

Alongside Alvelda, Brainworks brings together Volker Hirsch, who has spent 13 years investing in early-stage companies, including 6 years as Partner at Amadeus Capital Partners, often called Europe's most active AI investor, whose recent exits include OrganOx (acquired by Terumo) and Cryptosense (acquired by Eric Schmidt-chaired SandboxAQ). Louis Rajczi, with 14 years at Forté Ventures and 9 years at Siemens Venture Capital, rounds out the advisory team. All together, they bring 80+ years of combined experience building, scaling, and investing in AI companies. The team has collaborated for over 20 years, beginning in 2000, long before AI became fashionable. This isn't a group pivoting to chase the AI wave; they helped create it.

Upon selling his new ultra-low power AI chip business for over $90 million dollars, Dr. Ryad Benoseman credits Alvelda with offering the critical support to create his company. “Seven years ago, I founded GrAI Matter Labs with $1M from DARPA,” said Benosman, “It would not have been possible without the incredible talent of Phillip Alvelda, who understood, and believed in the theory of a novel brain-like machine.”

Where, according to Pitchbook, cloud-era startups typically needed $150 million across five financing rounds and 12 years to reach a listing, AI-native companies are reaching similar outcomes with as little as $6 million in capital in less than four years.

Co-founder and Managing Partner, Phillip Alvelda, turned $25 million in initial company formation grants from the government into a portfolio of bleeding edge health-tech companies now valued at over $2 billion and growing while serving as the Director of DARPA’s Neural Engineering Systems Design program. That type of track record in identifying breakthrough AI companies early, and supporting them with decades of real operating experience to achieve significant and impactful outcomes, forms the foundation of the Brainworks Ventures thesis.

“Our AI-native operating model means more of our LPs' capital goes into companies, not overhead,” Alvelda added. “Combined with faster exits and better ownership economics, we can deliver superior returns even at more modest exit valuations. That's the power of the new math.”

Additionally, Brainworks Ventures isn't just investing in AI companies, the fund operates as an AI-native entity itself. By using artificial intelligence to automate deal flow, portfolio design, diligence, and operations, the team has expanded its capacity to source, review, analyze deals and better support its portfolio companies compared to traditional venture funds.

“An AI-enhanced $50 million fund can now accomplish what it took a $500 million fund to achieve last year because AI-first founders build faster with less,” Alvelda continued. “The economics have fundamentally changed. Traditional VCs who don't adapt will be left behind.”

ABOUT BRAINWORKS VENTURES

Brainworks Ventures is an AI-native venture capital fund investing in pre-seed, seed, and Series A companies that leverage artificial intelligence to solve global challenges. Operating as a native-AI fund with AI-powered operations, Brainworks partners with AI-native startups worldwide to build the next generation of transformative technology companies. With deep expertise spanning AI research, company building, and venture investing across four continents, the Brainworks team brings unprecedented experience to the AI venture landscape. Learn more at https://brainworks.ai/