Brainworks Ventures has launched a $50 million AI-native venture capital fund that it says is built around what it describes as a new set of economics for companies designed from day one for artificial intelligence. The firm, led by DARPA alumnus Dr. Phillip Alvelda, said the fund is pursuing a first close of $15 million by Q1 2026, targeting a final size of $50 million with the ability to scale to $75 million.
The fund will invest across AI applications, infrastructure and tooling, healthcare and life sciences, enterprise productivity, and education, with check sizes ranging from $250,000 to $10 million. Brainworks said it intends to back AI native founders across North America, Europe, and the Asia Pacific, positioning the strategy as a bid to capture early-stage opportunities wherever teams are building.
Brainworks framed the launch as a response to what it views as a structural shift in how modern companies can be formed, staffed, and scaled. The firm pointed to the view that cloud-era startups often require far more capital and time to achieve major liquidity outcomes than AI-native businesses do, and cited PitchBook research to support the claim that AI-native companies can achieve comparable outcomes with substantially less capital in significantly less time.
The firm’s leadership team includes Volker Hirsch, a long-time early-stage investor who previously spent six years as a partner at Amadeus Capital Partners, and Louis Rajczi, who has held roles at Forté Ventures and Siemens Venture Capital. Brainworks said the broader group brings more than 80 years of combined operating and investing experience and has collaborated for more than two decades, positioning the team as long-term participants in the evolution of the AI ecosystem rather than recent entrants.
Brainworks also emphasized that it intends to run the fund itself as an AI native organization, using AI to automate and augment deal flow, portfolio construction, diligence, and fund operations. The firm said this approach is designed to reduce overhead and increase the share of limited partner capital deployed into portfolio companies while enabling the fund to evaluate and support a larger volume of opportunities than traditional venture models.
Alvelda’s investing and operating background is central to the firm’s positioning. Brainworks highlighted his time leading DARPA’s Neural Engineering Systems Design program, during which it said he converted $25 million in government formation grants into a portfolio of health tech companies now valued at more than $2 billion. The fund is also emphasizing a model that aims to pair software-driven speed with ownership discipline, arguing that faster build cycles and earlier exits can change return dynamics even without the largest possible headline valuations.
KEY QUOTES:
“The old VC equation was straightforward: raise $150 million over 4-5 rounds of finance, hire 100 or more people, wait 12 years, and hope for a unicorn listing. Now, old guard VCs are trying to bolt AI onto their portfolio companies’ existing legacy infrastructure. That’s like adding a turbocharger to a horse-drawn carriage. That just isn’t going to be competitive with future AI-native companies. That’s why we’ve designed an investment and return model we know will work and scale companies at newly enabled AI-rates from day one.”
“Our AI-native operating model means more of our LPs’ capital goes into companies, not overhead. Combined with faster exits and better ownership economics, we can deliver superior returns even at more modest exit valuations. That’s the power of the new math.”
“An AI-enhanced $50 million fund can now accomplish what it took a $500 million fund to achieve last year because AI-first founders build faster with less. The economics have fundamentally changed. Traditional VCs who don’t adapt will be left behind.”
Phillip Alvelda, Co-Founder and Managing Partner at Brainworks Ventures
“Seven years ago, I founded GrAI Matter Labs with $1 million from DARPA. It would not have been possible without the incredible talent of Phillip Alvelda, who understood, and believed in the theory of a novel brain-like machine.”
Dr. Ryad Benoseman
