The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch 20VC: a16z Raises $10BN in New Funds | Mercor Raises $350M at a $10BN Valuation | OpenAI Restructuring: Who Wins and Who Loses | Why IRR is a BS Metric and Three Ways to Win in VC Today
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Oct 30, 2025 
Rory O'Driscoll, a veteran VC specializing in SaaS, and Jason Lemkin, founder of SaaStr and growth-focused investor, dive into the dynamics of the current venture capital landscape. They dissect OpenAI's restructuring and who really wins from it. The duo also explores a16z's $10B fundraise and implications for scale in VC. They challenge the traditional IRR metric, proposing smarter strategies for VCs today while examining Mercor's impressive $350M raise amidst AI training needs. Amazon's recent struggles round out their insightful discussion.
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Use Options To Extend Follow-On Power
- Use optioning to participate in rounds without committing full follow-on capital.
- Pay up for option value only if you can back winners later or have a large follow-on fund.
Human Feedback Is Big AI Infrastructure
- Merkur (and similar firms) supply high-end human feedback for model training, turning RLHF into a massive revenue market.
- Rapid growth reflects huge AI CapEx and urgency from model providers to buy human expertise.
CapEx-Driven Businesses Need Continued AI Growth
- Merkur's upside depends on continued hyper AI CapEx growth and faces margin and customer-concentration risks.
- If AI spend slows, high revenue growth alone won't protect such vendors from pricing pressure.