Venture Capital in the age of Consensus

Something feels warped in venture capital. Software businesses with paying customers and growing revenue struggle to attract attention, while a handful of elite AI researchers can seek valuations of tens of billions before releasing a product. Investors talk about partnership while backing competitors. Even the terms agreed when a company was barely an idea become contentious once everybody wants in.

Harry Stebbings called it out:

Each of these developments has an explanation. Taken together, they raise a more uncomfortable question: how much of venture is still about discovering potential, and how much has become about buying access to what everyone already agrees will matter?

As a pre-seed investor, I find parts of this market frustrating. But I’m also encouraged by what founders can now accomplish. Capital is becoming more concentrated just as the ability to build is becoming more accessible. That tension creates opportunities worth paying attention to.

The age of consensus capital

Nico Wittenborn captured the mood with the phrase “the age of consensus capital”. The underlying figures are striking. According to the Q1 2026 PitchBook–NVCA Venture Monitor, five venture firms captured 73.1% of US venture fundraising during the quarter. Five deals accounted for 73.2% of US venture investment, or $195.6 billion. These are quarterly US figures, but they illustrate how narrow the flow of money has become.

Concentration at both ends matters. When fewer firms control more capital, their economics increasingly determine which opportunities get funded. A business capable of producing an excellent outcome for a small fund may barely register for a multibillion-dollar vehicle. The company hasn’t become less useful to its customers. It has become less relevant to the investor’s fund size.

There are rational reasons for LPs to favour established managers and for investors to back apparent category leaders. Some of those leaders will build extraordinary businesses. But an industry can make individually defensible decisions and collectively become less adventurous. If everyone needs exposure to the same companies, independent judgement risks giving way to the fear of being absent.

Venture has always depended on a small number of exceptional outcomes. The harder question is whether we are becoming too certain, too early, about where those outcomes will come from.

When traction struggles to compete with possibility

Many software founders find themselves in a strange position. Revenue and growth provide evidence that a business is solving a problem. Yet they can feel insufficient when an investor’s first question is whether AI will make the entire category disappear.

That question deserves to be asked. Existing revenue does not guarantee future relevance. AI can change pricing, weaken differentiation and shift value away from established software categories. Founders need a convincing answer about why customers will continue to choose them.

But scepticism should be applied consistently. We should scrutinise the durability of an existing business and the assumptions behind one that has yet to prove itself. Sometimes the market seems to demand certainty from the former while granting almost unlimited possibility to the latter. A company with customers has measurable imperfections. A company with a compelling vision can still be imagined as perfect.

Consider Business Insider’s reporting on Discovery Loop, founded by former Google chief scientist Jeff Dean and other prominent researchers. In September, it was reportedly seeking a valuation of around $50 billion, before releasing a product. That was a fundraising target, rather than a confirmed completed round.

There is an important caveat here. These valuations belong to a rarefied corner of venture: the new AI research labs, or “neolabs”, founded by people with exceptional research credentials. They are not representative of what an ordinary AI startup can raise. Investors are underwriting scarce talent, technical ambition and the possibility of a major scientific breakthrough.

That deserves serious consideration. Ambitious research often requires funding long before commercial validation. Pre-product investing is fundamental to venture, and as a pre-seed investor I would hardly argue otherwise.

The question is how much future success is already embedded in the price. At a $50 billion entry valuation, a tenfold increase implies a $500 billion company, before subsequent dilution. That doesn’t make the investment wrong. It does make the expectations extraordinary.

What happened to partnership?

The strain extends beyond valuations. TechCrunch reported that Benchmark’s partners acknowledge growing portfolio conflicts as AI companies expand into overlapping markets.

Two companies can become competitors through changes neither originally anticipated. That is different from deliberately financing a direct rival after gaining access to a founder’s plans. The distinction matters to anyone choosing an investor.

From the founder’s perspective, the questions are practical. Can I discuss a product roadmap openly? Can I explain why we lost a customer? Can I share an acquisition opportunity without wondering whose interests take priority? Confidentiality is essential, but trust also depends on attention, incentives and judgement.

Investors should be explicit about the relationship they offer. If the promise is close partnership, the obligations should reflect that. Founders deserve clarity before accepting the cheque.

A related issue sits underneath the pro-rata debate covered by Axios, following the dispute between Valar Atomics and Day One Ventures.

Without taking a position on that particular case, I think the credibility of an early agreement matters. Founders and investors should be able to negotiate changes as a company develops. Those conversations become harder to trust if bargaining power is the only principle that survives success.

Investors also need to earn their place through how they behave. A signed agreement cannot substitute for being useful, responsive and fair. Equally, a founder’s success should not automatically turn an early partner’s negotiated economics into an inconvenience. The ecosystem needs people willing to commit before the outcome is obvious, and relationships that remain workable afterwards.

Why I’m still optimistic at pre-seed

There is still an enormous amount that technology can improve. Small businesses spend too much time on administration. Healthcare professionals wrestle with fragmented workflows. Education struggles to adapt to individual needs. Creative work remains constrained by production costs. Consumers navigate services that are unnecessarily difficult to understand and use.

None of these problems becomes less important because most of the capital is flowing somewhere else.

What encourages me at pre-seed is how much further a small team can get before needing a large organisation. AI tools can help founders write code, explore designs, analyse information and test ideas with customers. An early cheque can potentially fund more learning, with fewer resources committed before the team understands what people actually need.

That does not make company building easy. Lower barriers to building also mean more competition. Distribution, customer trust, retention and reliable execution remain difficult. A working demo can arrive quickly; a business that customers depend on still has to be earned.

But the ability to run more experiments with less capital is meaningful. A team can pursue a neglected workflow, learn from a narrow customer group and expand from a position of understanding. It does not need to begin with a consensus view of an enormous market to discover one.

At Remagine Ventures, backing Israeli founders at pre-seed, that is the work I remain excited about: meeting people before the story is polished, understanding something others have overlooked, and helping turn an early insight into a business.

Small funds have to be disciplined about their own economics. Being overlooked is not proof of investment potential. But we can give serious attention to opportunities that are initially too small, too unfamiliar or too early for much larger investors.

Venture needs room for different fund sizes, different convictions and different paths to success. We should want ambitious research labs to succeed, while making space for founders whose strongest credential is how well they understand a customer’s problem.

I remain optimistic because the supply of important problems is enormous, and the tools available to solve them are improving. Capital may be clustering around the same names, but the next generation of founders does not have to wait for consensus to start building. Our job at pre-seed is to recognise their potential before consensus arrives.

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Eze Vidra

Co Founder and Managing Partner at Remagine Ventures

Eze Vidra is the founder of VC Cafe and the co-founder and managing partner of Remagine Ventures, a pre-seed fund investing in ambitious founders at the intersection of AI, technology, entertainment, gaming, and commerce with a spotlight on Israel.

He is a former General Partner at Google Ventures (GV) in Europe, former head of Google for Entrepreneurs in Europe, and founding head of Campus London, Google's first startup hub. Eze writes on Israeli tech, venture capital, artificial intelligence, and founder strategy.

He is also the founder of Techbikers, a nonprofit that brings together the startup ecosystem on cycling challenges in support of Room to Read.

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Latest posts by Eze Vidra (see all)

• Venture Capital in the age of Consensus - October 21, 2026
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