tech
How Justin Ernest Invested Nearly $500M into Hot Startups Without a Traditional VC Fund
Instead of spending a year raising a formal venture fund, the Sabertooth VC founder used a captive network of LPs to invest in startups like Anthropic, Anduril, and SpaceX.
TL;DR
- Justin Ernest founded Sabertooth Capital to bridge the gap for family offices and smaller institutional investors seeking access to high-growth AI companies.
- Instead of launching a traditional VC fund, Ernest uses his network to secure stock allocations in late-stage companies and offers them through SPVs, nominee structures, and single-asset funds.
- Sabertooth Capital has invested nearly $500 million in 10 companies, including Anthropic, Anduril, Base Power, Databricks, PsiQuantum, and SpaceX, with check sizes ranging from $10 million to $275 million.
- Ernest's strong reputation and direct relationships with founders and investors distinguish him in a market often perceived as 'shady'.
- The firm has already seen a major return from chipmaker Groq and anticipates further windfalls from upcoming IPOs of SpaceX and Anthropic.
- Ernest plans to grow Sabertooth's current model while ultimately aiming to raise a traditional venture fund, using his track record with SPVs to prove his capabilities.