Why private wealth is cutting out the VC middleman

Equity

TechCrunch

News, Business, Entrepreneurship, Business News, Technology

4.2 • 372 Ratings

🗓️ 1 April 2026

⏱️ 31 minutes

🔗️ Recording | iTunes | RSS

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Summary

The VC middleman is getting cut out faster than anyone expected. Family offices and private wealth firms are going direct: writing checks, taking board seats, even incubating companies from scratch. And more founders are starting to notice. In February alone, family offices made 41 direct investments, including one Midwest-based firm that led a $230 million Series B into an AI chip startup. On this episode of TechCrunch's Equity podcast, Rebecca Bellan caught up with Mitch Stein and Ari Schottenstein, founder and head of alternatives at ARENA Private Wealth, to find out what this shift means for founders, cap tables, and the future of AI investment. Listen to the full episode to hear: How Arena landed the lead on Positron's $230 million Series B, and why the CEO specifically wanted them on his cap table How Arena does due diligence on technical companies What "tourist capital" actually looks like, and the red flags founders should watch for as family offices flood into AI deals Why some VCs are quietly unhappy about this trend (and why Arena thinks that's their problem) Subscribe to Equity on YouTube, Apple Podcasts, Overcast, Spotify and all the casts. You also can follow Equity on X and Threads, at @EquityPod. Chapters: 00:00 Intro 03:13 Why family offices are going direct now 06:03 The gen 2 & gen 3 family office shift 07:22 Is this strategic or just AI FOMO? 10:17 How Arena got into the Positron deal 14:30 Why founders want private wealth on their cap table 18:31 Due diligence on technical companies 21:56 Red flags founders should watch for 25:04 Are VCs threatened by this trend? 27:47 Taking board seats & level of involvement 34:17 Outro Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Presented by Dot Tech Domains, where tech founders find sharp, memorable names for their tech startups.
0:05.9	Hello and welcome back to Equity, TechCrunch's flagship podcast about the business of startups.
0:10.4	I'm Rebecca Balan, and this is the episode where we bring on industry experts to help us explore a trend in the tech world and dive deep.
0:17.3	For those of you who tuned into our 2626 predictions episode, you might remember that we
0:21.5	guessed this year would be the year that family offices and private wealth firms would start
0:26.0	cutting out the VC middlemen and going directly to startups. Well, it's already happening. In February
0:30.8	alone, family offices made 41 direct investments nearly all tied to AI. And one Midwest-based private
0:37.2	wealth firm just led a $230 million
0:39.6	series B into an AI chip startup. Today, we're talking to the people behind that deal.
0:50.5	Joining us are Mitch Stein, founder and principal and Ari Schottinstein, head of alternatives, both from Arena Private Wealth.
0:57.8	Mitch, Ari, welcome to the show.
0:59.7	Great to be here.
1:00.2	Thank you for having us.
1:01.9	Yeah, we appreciate your interest in what we're doing and the opportunity to have this conversation.
1:06.0	Yeah, really excited to do this.
1:07.9	So tell us a little bit about Arena private wealth and what you are doing,
1:12.5	like how you are getting involved in these really impressive AI deals. Sure. I can start with
1:18.0	a little bit of the 30,000 foot view. And then Ari, please feel free to chime in. What we're attempting
1:23.6	to create and what we vision for our firm is to be a modern private wealth firm and to
1:30.0	really modernize and rethink what private wealth management looks like. So our platform is three
1:35.9	integrated verticals. We have our traditional wealth, which is very much what you would expect
1:40.3	a traditional RA to look like, tax planning, estate planning, portfolio management.
	...

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