David Frankel

Shield is acquiring Echodyne to expand our Mission Systems business with software-defined radars, engineering expertise and manufacturing capacity. The $5.3B transaction is supported by a $2.5B raise, including Series H funding at a $28.8B valuation, and will accelerate our efforts to meet growing demand for multi-mission capabilities. Echodyne’s industry-leading technology is used in hundreds of counter-drone and security systems worldwide, where it helps track drones, secure airspace, and protect people and infrastructure. Full release: bit.ly/4iYGLWc Funding includes a structured equity investment from @Blackstone and a Series H co-led by @disruptivetech and Innovation X Capital, with participation from @adventintl, the Strategic Investment Group of JPMorganChase's Security and Resiliency Initiative, @SnowpointVC, Apandion, Center15 Capital, and others. Autonomy for the world. The greatest victory requires no war.

Shield is acquiring Echodyne to expand our Mission Systems business with software-defined radars, engineering expertise and manufacturing capacity. The $5.3B transaction is supported by a $2.5B raise, including Series H funding at a $28.8B valuation, and will accelerate our efforts to meet growing demand for multi-mission capabilities. Echodyne’s industry-leading technology is used in hundreds of counter-drone and security systems worldwide, where it helps track drones, secure airspace, and protect people and infrastructure. Full release: bit.ly/4iYGLWc Funding includes a structured equity investment from @Blackstone and a Series H co-led by @disruptivetech and Innovation X Capital, with participation from @adventintl, the Strategic Investment Group of JPMorganChase's Security and Resiliency Initiative, @SnowpointVC, Apandion, Center15 Capital, and others. Autonomy for the world. The greatest victory requires no war.

Nearly nine years ago, @TJParker and I went to Bentonville to talk to @Walmart about building a different kind of pharmacy. While we were there, we visited The Walmart Museum. If you haven’t been, go! I loved seeing the history of a company that started with a single store and changed what people everywhere could buy and afford. We were building PillPack at the time, and spent much of that trip talking about what healthcare could learn from retail. Today we’re launching the new Walmart Better Care Services, a healthcare store powered by General Medicine. Starting today, customers can browse more than 900 products and services across a dozen different provider groups, compare cash and estimated insurance prices, and get what they need. Walmart defined the experience, chose the products, services, and providers. Our technology makes it all shoppable. A lot has happened since that first trip. We sold PillPack, built Amazon Pharmacy, and started @GeneralMedicine. We’ve spent most of our working lives trying to make getting healthcare easier. And somehow it still feels like we’re just getting started. We have incredible clinicians and treatments in this country. But finding the right care, figuring out what something costs, and actually getting it remains convoluted and complicated. Something that should have been a quick purchase becomes a project. Too often, people just put it off altogether. And when the problem is serious, all that hassle lands on top of what’s already hard. When transactions are easy, you take a whole layer of complexity off the table. We launched General Medicine a year and a half ago. A few weeks ago, we wrote about the idea behind it: healthcare needs a store. Helping Walmart build one for its customers is that idea reaching the scale we’ve been aiming at since PillPack. I love that we have our own store. We get to build things we’ve wanted to exist for years, hear directly from customers, and keep making them better. But I’m just as excited about helping other companies build theirs. We learned at PillPack how much more you can do when you work with companies that already serve millions of customers. Tech platforms, retailers, health systems, payers, and manufacturers all bring something different. There’s a lot more we can do together than any of us could do on our own. With Walmart, we get to work with a retailer and pharmacy that’s part of everyday life all across the country. This one is particularly special to me. We walked into Bentonville nine years ago hoping to build something together. It took a little longer than we expected, but here we are. Build the store. Then build more stores.

The AI Bubble will create Roadkill @DaFrankel (David Frankel), Managing Partner, @fcollective (Founder Collective), interviewed by @HarryStebbings (@20VC) Summary: David Frankel has written seed checks into Uber, Coupang, PillPack, SeatGeek, Whoop, Shield AI and Suno across 18 years at Founder Collective, and he expects this AI wave to leave more wreckage behind it than any wave he has seen. The money at the top of the market is competing for a handful of trillion-dollar names while the returns math sits far below that, in companies nobody is bidding on yet. His case is for getting in early, staying patient, and holding your frameworks loosely enough that they don't cost you the deal of the decade. 1. The $2.6 Billion Median. Fewer than 100 companies created in the last 25 years are sustainably worth over $10 billion. The median of the top 500 companies from that period is $2.6 billion, and owning 5% of one of those returns a seed fund. Frankel says venture has narrowed into a pyramid because Cambridge Associates and the funds of funds are selling access, and a fund that misses the $3 trillion names gets hard to sell. The returns math works at a fraction of that scale, which is why he says you don't have to be in the one. 2. Hollywood Odds. 95% of the companies riding this wave will not be there. Frankel believes OpenAI, Anthropic and SpaceX are the Metas and Googles of this era, and that the wreckage around them will be enormous. He has heard "this time is different" from Harry Stebbings and everyone else for 11 years, across the internet, SaaS and mobile waves that produced fewer than 100 companies over $10 billion between them. Asked whether another crash is coming, his answer is definitely, and nobody knows when. 3. Everyone Is AI Now. Saying you're not an AI company today is like saying you don't use the internet. Frankel's live example: a founder who spent 20 years in SAP consulting, built a platform, knew which part of it was still bad, started playing with Claude Code alongside his CTO, and came back raising at a $20 million cap. Founder Collective does those deals all day long. The AI label stopped carrying information, so what matters is what the founder knows that nobody else does. 4. The Insurance Policy. Founders are inviting small seed funds into $8 to $9 million rounds for $500K to $1 million as protection against being abandoned. The junior partner who championed you at the big fund leaves, starts their own fund, or moves, and your mandate goes with them. Nobody is left to argue for turning over another card, and the partnership goes back to its real winners. Frankel hates thinking of Founder Collective that way, and says the last 20 deals looked exactly like it. 5. Fewer Entrepreneurs. There are more founders than ever and fewer entrepreneurs. YC professionalized company founding into a norm for people leaving certain colleges, and Frankel thinks many of them lack the fortitude for the learning curve that follows. He watches the trajectories of CEO and CTO split: a good co-founding CTO stays useful in different roles up to 50 people, while the CEO has to learn to manage and to put bums on seats. Mikey Shulman told him 30% to 40% of his time at Suno is recruiting, and Jeff Bezos told a lunch table decades ago that it was 50% of his. 6. CEO-CTO Alchemy. Frankel wants the CTO to be a magician and the CEO to be a good salesperson. In 18 years he has seen that alchemy 4 or 5 times, and it comes from the interplay between 2 specific people rather than from either resume. He prefers co-founders who are different from each other, aligned on direction, and confident in each other's competence. He has said no more often than yes when the second founder looked weak, and he regrets some of those. 7. Ownership Cost Hundreds Of Millions. Founder Collective passed on ElevenLabs, Granola, StarCloud and Fractile purely because the ownership would have been 1% to 2%. Frankel calls it hundreds and hundreds of millions of dollars of lost returns, and it is the mistake he names first. He has never turned a founder down over percentage when he was all in: with Shulman he took the dilution the founder was willing to give, wrote every cent of the first round, and showed the deal to other people. His rule now is that when you meet the right people, you get what you get. 8. I Love It Because. Every Founder Collective team meeting starts with someone completing the sentence "I love it because." If you can't finish it, you can't invest. Valuation comes last in the sequence, after opportunity, market and founders, and Frankel says the price is rarely comfortable. The endings that work sound like insight into a vertical, or an edge nobody else can match in a commoditized business. 9. Vertical Nepo Babies. Frankel is writing a piece on why he loves funding nepo babies, and his definition is founders who grew up inside a vertical. TJ Parker was working in his father's pharmacy at 14, years before PillPack. Evan at Rebar worked for his uncle's HVAC company, one of 10 rolled up by private equity, was told to go find the AI for blueprint quoting, found none existed, and started the company. Over 100,000 US mechanical engineers make at least $100K a year doing that quoting by hand. 10. The Theme Before The Theme. Founder Collective's second fund reads as an applied AI fund today, and applied AI was not a theme when those checks were written. Shield AI was already called Shield AI in 2016. Drones, video cameras and the rest of that hardware are commoditized now, some of it down to $20, and the value came from putting AI around commoditized platforms. Frankel's job is to be in the next theme 5 or 10 years early, and he points out those companies are never the expensive ones. 11. The Last 5%. The SaaS apocalypse is overdone for embedded software and real for everything else. Frankel's test is what runs inside your system: billions of orders in real time, or mission-critical biotech research. Veeva and Olo are much harder to rip out than a horizontal tool a customer can rebuild in Claude over a weekend, which is why he thinks the market threw the baby out with the bathwater. The contrarian trade he does not run would be buying a basket of top SaaS stocks that have lost most of their market cap. 12. Disruption Comes From China. OpenAI and Anthropic will be disrupted, and Frankel thinks there is an excellent chance it comes from China. He is watching the strength of the Chinese open models and notes those labs have not had time to establish incumbency before being taken down. Underneath that, he expects photonic computing to come for Nvidia, because every connectivity piece in a data center that can be fiber already is, and the chip is the last piece that isn't. His broader worry is that the US has cut DARPA and university R&D, which is the money that produced all of this in the first place.

The wallet wars are here. Very Good Security chief strategy officer Terry Angelos joins a16z's Alex Rampell, his TrialPay co-founder from back in 2006 (TrialPay was later acquired by Visa), to discuss how agents are learning to spend money. "Agents have all of a sudden become significantly more helpful and useful because they effectively have arms and legs, which are payment credentials." VGS holds the payment credentials behind about 1/3 of all e-commerce, and now it's helping AI agents pay merchants. If you've bought anything online, there's a good chance VGS has already helped keep your card safe. In the last three months, Terry says agents went from "spectators to actors." Once an agent has your payment credentials, it can book the piano teacher it previously could only find and recommend. Now Stripe's Link, Shopify's Shop Pay, and PayPal are racing to connect to agents. It's all headed toward open standards from the card networks: agentic tokens that let an agent pay with your actual card. VGS went from zero agentic tokens to a few million a week in three months. 0:55 From TrialPay to Visa to VGS 2:05 How VGS vaults 1/3 of e-commerce 6:05 Why big merchants use 3-5 processors 9:55 Why AI agents need a payment vault 12:15 Agents go from "spectators to actors" 13:40 The wallet wars, old and new 19:55 Walled gardens vs open standards 23:55 How agents can pay with your real card 26:40 Your saved card goes multiplayer 29:40 How do you trust an agent's purchase? 32:35 Who pays when your agent gets it wrong 35:40 Why Amazon blocks agents 39:50 What's overhyped and underhyped 43:35 When merchants get agents too 45:40 Why agents could break card rewards 47:00 VGS's eras: vault, updates, network @terryangelos @arampell