Quanta scion’s new VC play: no new funds, just deals

AI exuberance has allowed VCs in the US to deploy US$250.2 billion by the third quarter of 2025, and the year isn’t over. That’s the most since 2021, when firms shelled out US$360 billion.

But for VCs wishing to participate in funding rounds for AI startups in the US – even those that just develop products supporting the industry, such as data centers and new energy sources – the competition is tough.

Looking for an edge, Taiwan-based VC firm Mesh Ventures has switched to a deal-to-deal funding setup instead of raising new funds.

Mesh Ventures Managing Partner Sam Lam. / Image credit: Arsal Ysfin

Managing partner Sam Lam says the rationale is simple: Limited partners (LPs) can decide on which startup funding rounds to invest in instead of committing their cash to a general fund, which often takes seven to 10 years to deliver any returns.

He’s also offering a guarantee: Investors will see an exit in three years.

“If these startups don’t, we will offer our services to LPs for free,” Sam tells Tech in Asia. “Because we only charge fees for three years. After that, we will incur all the costs.”

It’s a ballsy move, considering that exits have been difficult to come by even for VC-backed startups in the US. As of the end of the third quarter, there have only been 24 exits via mergers and acquisitions, with approximately a dozen tech IPOs, according to PitchBook. That’s about half of what 2021 delivered for investors.

But as the son of Quanta Computer founder and chairman Barry Lam, Sam has the funds and the network to help a startup accelerate an exit strategy.

Quanta, which Forbes named as the world’s top supplier of servers to cloud service providers by revenue, rose to prominence as a contract manufacturer of laptops. Apple is among its most popular clients.

Sam remains optimistic about Mesh’s investment prospects in its new funding model despite the current liquidity crunch.

“With deal-to-deal, we don’t have to convince LPs to look five years into the future and convince them this is how the world will change,” he says.

Doing so has been more difficult, given how quickly tech has changed in recent years, according to Sam.

“A deal right now will show them a startup has the traction, the market, and the technology,” he explains.

Taiwan connection

Family offices’ flexibility