Brainworks Ventures, an AI-native venture capital firm founded by DARPA alumnus Dr. Phillip Alvelda, has officially launched a new $50 million fund built specifically for what Alvelda calls “the new mathematics of AI-native companies.” The firm plans an initial close of $15 million by Q1 2026, with the ability to scale the fund up to $75 million as demand grows.
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Unlike traditional VC models that have defined the last two decades of Silicon Valley, Brainworks argues that the old rules no longer apply. The firm believes AI-native companies operate on entirely different cost structures, timelines, and scaling curves—and that venture capital must be redesigned accordingly. Their debut fund will back startups across AI applications, infrastructure, healthcare and life sciences, enterprise productivity, and education, writing checks from $250,000 up to $10 million across North America, Europe, and Asia-Pacific.
Dr. Alvelda explains the shift bluntly: “The old VC equation was straightforward—raise huge rounds, hire hundreds of people, wait a decade or more, and hope for a unicorn. Today, traditional investors are trying to bolt AI onto legacy systems, which is like adding a turbocharger to a horse-drawn carriage. It simply won’t compete with companies engineered to be AI-native from day one.”
Brainworks Ventures brings deep credibility to this thesis. Alongside Alvelda, the leadership team includes longtime collaborators Volker Hirsch formerly a partner at Amadeus Capital Partners, Europe’s most active AI investor and Louis Rajczi, who spent over a decade at Forté Ventures and Siemens Venture Capital. Together, the team has more than 80 years of experience working with AI long before it became a mainstream investment trend.
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Their track record includes helping founders like Dr. Ryad Benosman build breakthroughs such as GrAI Matter Labs, a company that began with $1 million in DARPA funding and went on to sell its ultra-low-power AI chip technology for more than $90 million. Benosman credits Alvelda’s conviction early on: “It would not have been possible without Phillip, who believed in the theory of a novel brain-like machine.”
Brainworks argues that these types of outcomes are becoming increasingly common. Research from PitchBook shows that while cloud-era startups often required $150 million and a decade to reach an exit, AI-native companies are achieving similar milestones with just $6 million in under four years. This acceleration combined with leaner operating models is the backbone of Brainworks’ investment strategy.
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Alvelda himself has a history of turning government-backed innovation into real enterprise value. While directing DARPA’s Neural Engineering Systems Design program, he transformed $25 million in federal grants into a portfolio of health-tech companies now valued at over $2 billion. This experience forms the foundation for the new fund’s approach to identifying and supporting early AI breakthroughs.
One of Brainworks’ boldest differentiators is that the fund itself is AI-native. Rather than hiring large teams, Brainworks uses artificial intelligence to automate deal sourcing, screening, diligence, portfolio modeling, and operational support. This allows LP dollars to flow primarily into startups rather than overhead.
“Our AI-native operating model means more of our LPs’ capital goes directly into companies,” Alvelda said. “With faster exits and better ownership economics, we can deliver superior returns even at more modest valuations. That’s the power of the new math.”
He believes the shift is existential for traditional venture capital: “An AI-enhanced $50 million fund can now accomplish what it took a $500 million fund to achieve last year. The economics have fundamentally changed. Traditional VCs who don’t adapt will be left behind.”
Brainworks Ventures is positioning itself not just as an investor, but as an early architect of the AI-native era—betting on founders who are building the next generation of companies from first principles.
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