🧠 Food for thought

Implications, context, and why it matters.

Iconiq’s investment engine now draws from more than tech billionaires

• Former Goldman Sachs and Morgan Stanley advisors founded Iconiq, which first managed money for early Facebook executives such as Mark Zuckerberg 1.
• The circle later took shape as an advisory council that includes Zuckerberg, Yahoo co-founder Jerry Yang, and General Motors CEO Mary Barra 2.
• Backing once came mostly from wealthy clients, while the firm now also takes capital from institutional investors such as pension funds and other large professional money managers 2.
• In its recent US$5.75 billion fund, wealth management clients provided less than 20% of the capital, compared with roughly two-thirds in its first fund 3.
• Large pension funds now rank among the backers, including the New York State Common Retirement Fund, the pension fund for New York state government workers and retirees 4.

An investor’s AI buying streak comes after a cautious stretch

• Iconiq increased its AI investing after it pulled back on new venture investments in 2022 2.
• In 2022, Iconiq Growth made no new investments, a general partner said. The firm later clarified that two investments closed in early 2022 after commitments in 2021 2.
• During that period, it added to positions in public companies it had backed as private firms, including Datadog, a cloud software company. It also boosted stakes in portfolio companies, sometimes by buying secondary shares from existing investors 2.
• Over the last year, Iconiq made six new AI investments, including Writer, which builds software that helps businesses generate text with AI, and Pinecone, which provides data infrastructure used to build AI applications 3.
• With top-quartile performance, including a 2014 fund that returned 5.5 times invested capital, the move signals that some elite investors expect AI demand to last. That view could sway startup valuations across venture capital 2.