level: business
justin ernest saw family offices and smaller investors locked out of hot ai company cap tables. instead of raising a formal vc fund, which can take over a year, he used his network to secure stock allocations in companies like anthropic, anduril, databricks, psiquantum, and spacex. his firm, sabertooth vc, structures each deal as a separate special purpose vehicle, or spv, letting about 30 limited partners buy into single-company funds. over 12 months, sabertooth deployed nearly $400 million across 10 companies, with check sizes from $10 million to $275 million, always through official funding rounds.
ernest's reputation sets him apart in a space where spvs can be unreliable. a family office cio said ernest has real technical judgment and expertise, unlike others who just aggregate capital. when that cio tried to invest directly in psiquantum, the startup's cfo pointed him to sabertooth. this trust matters because companies like anthropic and anduril are cracking down on unauthorized spvs. investing through sabertooth gives smaller backers confidence their money is with someone vetted by the startups themselves.
ernest, a harvard business school graduate, credits his network for quick capital raises. he can call a few limited partners and know their commitments fast. sabertooth already saw a big return from groq's $20 billion deal with nvidia. upcoming ipos from spacex and anthropic could bring more gains. ernest plans to eventually raise a traditional fund, using these spv returns as a track record. for now, he says starting with spvs let him be 'in the action' during what he calls one of the best investment periods.
why it matters: spvs give smaller investors access to late-stage ai startups, but trust and direct company relationships are critical to avoid unauthorized deals.