Deven Parekh, co-leader of Insight Partners for over two decades, shared insights into the firm’s investment philosophy during a recent TechCrunch event in New York. Unlike many venture capitalists who focus heavily on a few high-profile AI companies, Insight Partners maintains a diversified portfolio across stages, sectors, and geographies.
Insight Partners, managing $90 billion in assets, has stakes in major AI players like OpenAI and Anthropic but chooses not to concentrate its investments solely on these frontier AI labs. Parekh explained that while some firms are placing large bets on a handful of companies, Insight prefers spreading risk across a broader range of opportunities. This approach aligns with the firm’s long-term perspective, as it is currently on its 13th fund and considers performance over multiple fund cycles.
Parekh acknowledged the transformative potential of AI, particularly in healthcare, where AI can analyze vast patient data to predict medical risks. He also noted the inherent risks of AI technology but compared them to risks associated with other technological advances, emphasizing the overall positive impact on living standards.
The firm invests across early-stage, growth, buyouts, and secondaries without fixed allocations, adapting to market conditions. Parekh pointed out that buyouts have been less attractive recently due to high interest rates and lower exit multiples. On the venture side, rapid funding rounds have increased valuations without corresponding risk reduction, prompting Insight to focus more on earlier-stage investments where smaller bets can be made and winners supported over time.
Geographically, Insight invests globally but recognizes that AI infrastructure talent is concentrated in San Francisco, while vertical AI sectors like financial services are more dispersed. The firm lost some deals, such as the AI legal-tech company Legora, to competitors but remains focused on backing strong founders wherever they are located.
Regarding investments in competing AI companies, Insight holds shares in both OpenAI and Anthropic. Parekh explained that while early-stage investments typically avoid direct competitors due to information-sharing restrictions, later-stage investments are more about acquiring stakes in promising companies without governance roles.
Insight remains cautious about physical AI and robotics, viewing them as still in early development stages. The firm also sees secondaries as an important liquidity mechanism, especially given the large amounts of capital raised in recent years and the need for funds to return capital to limited partners.
Looking ahead, Parekh expects more AI companies to go public, noting that while the largest firms may dominate headlines, the broader market will need to absorb a wider range of public offerings. He also highlighted the cyclical nature of venture capital, with limited partners often entering markets late in the cycle.
Ultimately, Insight Partners prioritizes a balanced portfolio, careful risk management, and backing talented founders across sectors and regions, rather than concentrating heavily on a few headline-grabbing AI companies.