Fortune just wrapped up its Global Forum in Riyadh, Saudi Arabia, which hosted business and finance leaders to discuss a range of business topics, including—unsurprisingly—the future of artificial intelligence. Speakers included major names such as Qualcomm’s Cristiano Amon, Bridgewater Associates’ Ray Dalio, and Citi’s Jane Fraser, with almost every conversation managing to work some aspect of how AI is reshaping industries.

What caught my eye was Andreessen Horowitz’s partner Anjney Midha sharing his perspective on where, amid an explosion of AI startups and simmering fears of a potential bubble, the next wave of investment opportunity might lie. Midha said the new “golden age” of investment opportunities would come in an “explosion of new frontier teams.”

“It was very popular two or three years ago to say there’s only going to be three or four labs and teams that are going to do any real training…and startups will be left to pick the pieces up of tiny niche opportunities here and there,” he said.

But reasoning models have changed the game, Midha said, referring to the new generation of AI systems designed to “reason” problems step by step, mimicking logic and reflection rather than predicting the next word in a sequence. These models can evaluate their own outputs better, break complex tasks into sub-tasks, and learn from feedback, potentially bringing AI closer to complex, real-world problem-solving.

“Reinforcement learning as a new paradigm is working so extraordinarily well, especially on mission-critical problems,” Midha said. “If you can define the reward model correctly, which startups are really good at doing when they embed themselves inside an industry—they go deep, they go vertical, and they end up understanding the customer’s problem end to end—you can build entirely new, multibillion-dollar companies doing full end-to-end reinforcement learning for each industry.”

During the same panel, Midha also expressed concerns about China’s growing dominance in the open-source AI space, calling the technology “China’s game right now,” something that could pose challenges for the U.S. and its allies. He said Western labs were scrambling to catch up, predicting this scramble would result in a wave of open-weight models from U.S. companies.

Despite some of the ongoing debate about an AI industry bubble, the investment surge doesn’t appear to be cooling off.

According to recent data from S&P Global Market Intelligence, venture capital investment in generative AI has surged to unprecedented levels in 2025, with total funding on pace to more than double from last year. Investors have poured more than $73.6 billion into GenAI application startups in the first three quarters of the year, bringing total investment across the GenAI and broader AI ecosystem to $110.17 billion this year. That figure represents an eightfold increase since 2019.

Much of this capital has flowed to large foundation model providers such as OpenAI, Anthropic, and Mistral AI, which continue to command multibillion-dollar rounds and soaring valuations. OpenAI’s $40 billion funding earlier this year remains the single largest deal, while Anthropic’s $13 billion round and Mistral’s €1.7 billion Series C underline the dominance of a handful of major players.

In other news: Fortune’s Cyber 60 list is out! The annual list, created in partnership with Lightspeed Venture Partners, ranks the most promising startups in the cyber security sector. This year’s list has lots of new names developing innovative tools to defend against AI threats, while some of the existing heavy hitters on the list have raised more capital and built out their rosters of customers. Check out the Cyber 60 list here.

Correction: Yesterday’s newsletter mistakenly said that Figma listed its shares on the Nasdaq, when of course, its IPO was on the NYSE. We regret the error.

Beatrice Nolan
X: @beafreyanolan
Email: bea.nolan@fortune.com

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VENTURE DEALS

– Fruitist, a Century City, Calif. And San Isidro, Argentina-based superfruit snack brand, raised $150 million in funding. J.P. Morgan Asset Management led the round and was joined by others.

– Frontline Wildfire Defense, a San Francisco-based wildfire defense company, raised $48 million in Series A funding. Norwest led the round.

– Recess, a Los Angeles, Calif. and New York City-based developer of non-alcoholic beverages designed for relaxation, raised $30 million in Series B funding. CAVU Consumer Partners led the round and was joined by Rocana, Midnight Ventures, Torch Capital, and others.

– Reflectiz, a Boston, Mass.-based AI-powered website security company, raised $22 million in Series B funding. Fulcrum Equity Partners led the round and was joined by Capri Ventures, YYM Ventures, AFG Partners, and others.

– Kaizen, a New York City-based developer of software designed for public services, raised $21 million in Series A funding. NEA led the round and was joined by 776, Accel, Andreessen Horowitz, and Carpenter Capital.

– Arya Health, a New York City-based platform designed to automate scheduling, compliance, and other processes for home health and post-acute care providers, raised $18.2 million in Series A funding. ACME Capital led the round and was joined by Ridge Ventures, Twelve Below, and others.

– Emerald AI, a Washington, D.C.-based AI-powered energy consumption platform for data centers, raised $18 million in a seed extension. Lowercarbon Capital led the round and was joined by NVIDIA, Radical Ventures, Salesforce Ventures, National Grid Partners, Amplo Ventures, Earthshot Ventures, and others.

– Sweatpals, an Austin, Texas-based in-real-life fitness platform designed to bring people together, raised $12 million in funding. Patron, a16z speedrun, and HartBeat Ventures led the round.

– Polygraf AI, an Austin, Texas-based enterprise AI security platform, raised $9.5 million in seed funding. Allegis Capital led the round and was joined by Alumni Ventures DataPower VC, Domino Ventures, and existing investors.

– CustoMED, a Ramat Gan, Israel-based platform using AI and 3D printing to generate surgical tools and implants, raised $6 million in seed funding from Longevity Venture Partners, Varana Capital, Flag Capital, and others.

– Human Health, a London, U.K.-based precision health platform, raised $5.5 million in funding from LocalGlobe, Airtree, Skip Capital, Aliavia, Scale Ventures, and angel investors.

– Marleybones, a London, U.K.-based dog food brand, raised £2.5 million ($3.3 million) in funding. TAW Ventures led the round and was joined by existing investors JamJar Investments, Active Partners, and Animal Health Angels.

PRIVATE EQUITY

– Francisco Partners agreed to take Jamf, a Minneapolis, Minn.-based Apple device management and security company for organizations, private for $2.2 billion.

– Forward Consumer Partners agreed to acquire a majority stake in Justin’s, a Boulder, Colo.-based nut butters and confections company, from Hormel Foods. Financial terms were not disclosed.

– GPT Industries, a portfolio company of Branford Castle Partners, acquired Integrated Rectifier Technologies, an Alberta, Canada-based manufacturer of transformer rectifiers and related products for the cathodic protection industry. Financial terms were not disclosed.

– Peak Toolworks, backed by Granite Creek Capital Partners and Canterbury Ventures, acquired Southern Carbide, a Shreveport, La.-based industrial tooling and sharpening company. Financial terms were not disclosed. 

– Uncommon Equity acquired HopCat, a Grand Rapids, Mich.-based casual dining chain. Financial terms were not disclosed.

PEOPLE

– AE Industrial Partners, a Boca Raton, Fla.-based private equity firm, hired Chris Aguemon and Bill Strobel as Vice Presidents. Previously, Aguemon was with Arlington Capital Partners and Strobel was with Liberty Strategic Capital.

– Earlybird Health, a Berlin and Cologne, Germany-based venture capital firm, promoted Dr. Rabab Nasrallah and Dr. Christoph Massner to Partners. 

– Windjammer Capital, a Newport Beach, Calif. and Waltham, Mass.-based private equity firm, hired Evan Klebe as Managing Director and Beth Lesniak as Principal. Previously, Klebe was with Beach Point Capital Management and Lesniak was with Norwest Equity Partners.

– Wing VC, a Palo Alto, Calif.-based venture capital firm, hired Sunil Potti as a Venture Partner. Previously, he served as General Manager and Vice President of Security at Google Cloud.