Insight Partners’ Devin Parekh on why the firm is diversifying while everyone else bets the farm on OpenAI and Anthropic
In a candid interview at TechCrunch’s StrictlyVC event, co‑lead Devin Parekh explained that Insight’s portfolio still includes minority stakes in both OpenAI and Anthropic, but the firm resists the “all‑in” approach that dominates current VC fundraising. Instead, Insight writes $20‑$25 million checks on early‑stage deals, exemplified by its multi‑round involvement in Wiz, and avoids large‑ticket, high‑valuation follow‑ons that lack incremental data. The firm’s $90 billion under management is spread across early‑stage, growth, buyout and secondary opportunities, with buyouts on hold since 2024 due to tight debt markets and falling software exit multiples.
This stance contrasts sharply with the broader market, where OpenAI and Anthropic together captured roughly half of all AI‑related VC dollars in the first half of the year. Some funds are now pitching allocations of 35‑40 % of a single fund to one of those two companies, a concentration that Parekh warns is at odds with the long‑term diversification that historically drives private‑equity returns. While firms like Founders Fund and Thrive have profited from concentrated bets, Insight’s ten‑fund horizon compels a more balanced exposure. The interview also highlighted geographic nuances: AI infrastructure talent remains clustered in San Francisco, whereas vertical AI applications such as fintech (e.g., Ramp) draw talent to New York, suggesting that a diversified AI thesis can still be globally sourced.
Looking ahead, Insight’s emphasis on early‑stage, lower‑ticket bets positions it to benefit if the current valuation surge proves unsustainable and later‑stage rounds contract. The firm’s openness to secondaries reflects a market flush of capital from 2021‑2023 that has yet to generate liquidity, creating opportunities for investors who can provide exits. However, the firm’s modest exposure to physical AI and robotics signals a cautious stance on longer‑term, capital‑intensive bets. Stakeholder watch‑lists should include Insight’s next fund composition, the performance of its early AI investments versus the high‑concentration funds, and whether the firm will re‑enter buyouts as debt conditions improve.
Key Takeaways
Insight Partners maintains minority stakes in both OpenAI and Anthropic but avoids large, exclusive positions, preferring a diversified portfolio across stages.
The firm’s strategy of writing $20‑$25 million early‑stage checks aims to capture upside while limiting downside in an environment of inflated valuations.
Concentrated AI funds that allocate 35‑40 % of capital to a single lab risk alienating LPs, whereas Insight’s ten‑fund perspective favors broader exposure.
Secondaries are becoming attractive for Insight as the 2021‑2023 capital surge creates a supply‑demand gap for liquidity, potentially boosting returns if managed prudently.
About the Source
This analysis is based on reporting by TechCrunch. Here is a short excerpt for context:
Insight Partners' Devin Parekh opens up about losing Legora to General Catalyst, why he's fine holding stakes in rival AI labs, and why — even as everyone else piles into OpenAI and Anthropic — his $90 billion firm is deliberately staying diversified.Read the original at TechCrunch
