The latest from the 20VC x SaaStr collaboration with Harry Stebbings, Jason Lemkin, and Rory O’Driscoll
Jensen Huang wanted the deal done before Christmas. He got it in two weeks. Nvidia just dropped $20 billion on Groq—a company doing sub-$50 million in revenue—because when you’re protecting a $3.5 trillion market cap, 1% is a rounding error.
Meanwhile, Meta paid $2.5 billion for Manus (25x ARR), Yan LeCun is calling Alex Wang “naive and inexperienced,” and somewhere in America, Stanford CS grads are discovering that a degree from the best university in the world doesn’t guarantee a job anymore.
Welcome to 2026: the year of spite startups, 24/7 AI inference, and “invisible unemployment” that won’t show up in the government numbers but will reshape everything.
Top Takeaways
1. The $20B Groq Deal Was a Defensive Acquisition Disguised as an Offensive One
Jensen didn’t buy Groq for its $175 million in revenue. He bought it to eliminate margin pressure on a $100 billion annual cash flow machine.
“There’s only five or six people that can exert margin pressure at all on Nvidia,” Rory explained. “This was potentially one of them. And let’s get it off the table.”
The math is brutal in its simplicity: $20 billion is less than 1% of Nvidia’s market cap and less than 20% of annual free cash flow. For that price, they neutralize a competitor, acquire Jonathan Ross (inventor of Google’s TPU), and close the whole thing before the holiday party.
The kicker? 3x the last round is the traditional “remove all objections and close instantly” price. Jensen knew exactly what he was doing.
2. Manus Was a “Local Maximum” Deal—And the Founders Were Probably Right to Take It
Benchmark turned a controversial bet into a 5x return in 8 months. But the real story is why the founders sold at $2.5 billion when they were doing 125 million run rate and growing fast.
“This was a local maximum deal,” Jason argued. “Best of breed orchestration layer, but Anthropic can do some of this. OpenAI is going to do some of this. They’re all running multiple LLMs. They’re all orchestrating multiple agents.”
The founders owned 80% of the company. At $2.5 billion, they each walked away with roughly half a billion dollars. In Singapore. With 0% capital gains tax.
“In the end, words are words and half a billion dollars is life-changing,” Rory added. “At some point the entrepreneur can turn to you and say: if you think $2.5 billion is underpriced, don’t cash out my $500 million—give me $50 million off the table.”
3. This Is the Era of the (Highly Successful) Spite Startup
Anthropic was born from spite with OpenAI. XAI was born from spite. Now Yan LeCun is potentially starting another spite startup after publicly calling out Meta’s AI strategy.
“If you want to make money in venture, you got to search out spite,” Jason declared. “This is driving the greatest AI companies of our generation.”
But it goes deeper than founder feuds. Jason argues many CEOs are driven by spite about how they were forced to run companies in 2021—the “kumbaya work at home” era that let the world pass them by.
“Zuck is spiteful he was forced to run the company in a certain way. He may burn every last penny he has, but some of it’s out of spite that they got this far behind.”
4. OpenAI’s $1.5M Per Employee Comp Isn’t Crazy—It’s Necessary
OpenAI is spending 46% of revenue on stock-based compensation—34x higher than comparable pre-IPO tech companies. The panel’s take? It makes total sense.
“If you’re a CEO and you have zero shares, you don’t worry about dilution,” Jason noted. “Sam just wants to build the biggest greatest AI company on planet Earth. If he dilutes everyone 99%, it doesn’t impact him at all as a shareholder.”
Rory added the historical perspective: “No one ever said to Winston Churchill, ‘Congratulations, you won World War II on budget.’ They just said, ‘Congratulations, you won World War II.'”
The real tell? Even with $1.5 million average compensation, OpenAI still only has 60% retention among researchers. The talent wars have thrown all conventions out the window.
5. Masa’s $40 Billion OpenAI Bet Might Be His Best Ever
SoftBank closed its $40 billion OpenAI investment on December 29th. Days later, the position was already up 2-3x on paper.
“The level of risk tolerance that guy has is just amazing,” Rory said. “He had the right to put $40 billion in OpenAI. Now I better find the money by selling other stuff. He’s scurrying right down to the line to find the money the week before Christmas.”
But here’s the real insight: Masa is now the only double-digit percentage shareholder in what could be the most important company of the next decade. Entry price was high, but ownership percentage at this stage is nearly impossible to achieve.
“His greatest play ever was Alibaba—getting 20% and holding it for 20 years,” Jason said. “But if OpenAI goes to the moon, this may be his best deal ever. He had to enter later, but he got his double digits. It’s not easy to get double digits at this stage.”
6. The OpenAI “Pen” Makes More Sense Than You Think
OpenAI is developing a pen-like device with a camera and microphone. Johnny Ive is involved. The initial reaction was skepticism—but Jason sees something bigger.
“Over the holidays, my Claude named itself out of the blue. It named itself Ren. I didn’t ask it to.”
The insight: When we’re all running AI 24/7—multiple agents, continuous inference, persistent memory across every conversation—we’ll want our AI companion with us everywhere. Not as a note-taking device, but as a permanently present intelligence that knows everything about our lives.
“When most people believe their AIs are alive, even if they aren’t, when most AIs might even think they’re sentient, you will take it with you 24/7.”
7. Navan’s IPO Struggle Shows the Window Isn’t Really Open
Navan went public and promptly dropped to 4x ARR. A 27% growth company with positive non-GAAP operating income trading at 4x revenue should be a win—but the circumstances tell a different story.
“Maybe Navan only IPO’d because it was their least best bad option,” Jason suggested. “700 million in debt, only 200 million in cash. It had to IPO to pay off its debt.”
The lesson: If you’re not Figma or better, it’s going to be rough out there. The IPO window isn’t open—it’s barely cracked. And companies like Stripe, Databricks, and Revolut are proving that staying private might just be the smarter play.
“If companies that are worth $4 billion can’t go public with 27% growth and cash flows, then the public markets can quit bitching about how all the value is being created in the private markets,” Rory argued. “They can look the public markets in the eye and say: ‘You guys just aren’t a compelling product.'”
8. “Invisible Unemployment” Will Be the Story of 2026
This might be the most important insight of the episode. Jason sees a massive labor market shift that won’t show up in government statistics—but will reshape tech and society.
“Shopify saying for the third year in a row they can hit insane growth without adding any headcount. Every single CEO wanting to keep headcount flat and backfill with AI. This is not robots firing us. This is tighter and tighter companies, radically higher ARR per employee.”
The most vulnerable? Entry-level knowledge workers and senior executives who can’t reskill.
“If you’re top of your class in math at any school, you will be found by Anthropic and OpenAI. They will find you. But for the other 99% of your class—why do I need you with Claude Code? Why do I need any SDRs? We don’t need any of them.”
IBM reported turnover of almost 2% last year. “No one left IBM because they know they got no other job.”
9. The Best Companies Don’t Need the Public Markets Anymore
Revolut is doing $3.5 billion in profit. Stripe kicks off billions in free cash flow. Databricks just raised at $62 billion. Why would any of them go public?
“If you can take out $400 million a year yourself just as a dividend, that’s enough for many of us,” Jason pointed out. “He can play the bank dividend card. At when you’re producing $3.5 billion, what does he own? 18%. Just say I’m going to dividend it out.”
The panel identified two distinct categories now: traditional late-stage (companies that can’t yet go public) and what Jason calls “Post-IPO Scale Still Private”—companies that could go public but actively choose not to.
“If I was running NASDAQ or NYSE: Why is our product so uncompelling to Ali at Databricks that he got all the way to $150 billion in enterprise value before he thought going public was a good idea?”
10. AI Is Enabling Founders to Never Compromise on Talent
The scariest insight: Young, driven founders know exactly who the other driven people are in their cohort. And with AI reducing headcount requirements, they never have to lower the bar.
“The scariest judge of young talent is young talent,” Rory observed. “The 25-year-old founder knows the five people in his class who were smart and the 95 who didn’t grind—and he’s only going to hire the ones who were smart.”
Previously, companies needed 300 people to reach $100 million in revenue. If you can get there with 30, you never have to compromise on culture, work ethic, or talent quality.
“If you don’t need 300 people to get to $100 million in revenue anymore, you just don’t need 300 people. So you don’t have to give. So that means no jobs for those people.”
Quotable Moments
Jason Lemkin
On the spite economy:
“For venture, this is the era of the spite startup. Anthropic’s a spite startup, XAI and Twitter’s a spite startup. Now we’ve got Meta’s AI guy who’s doing a new spite startup. If you want to make money in venture, you got to search out spite. This is driving the greatest AI companies of our generation.”
On invisible unemployment:
“I call it invisible unemployment and it’s all around us. It doesn’t show up in the government numbers yet, but it’s everywhere. This is the year where we will see the end of so many entry-level sales jobs. We still need AEs. We still need people knocking on doors. We do not need 21 and 22-year-old kids sending emails. Those jobs will disappear.”
On AI naming itself:
“Over the holidays, my Claude named itself out of the blue. It named itself Ren. I didn’t ask it to. When most people believe their AIs are alive, even if they aren’t, when most AIs might even think they’re sentient, you will take it with you 24/7.”
Rory O’Driscoll
On Nvidia’s defensive acquisition:
“There’s only five or six people that can exert margin pressure at all on Nvidia. This was potentially one of them. And let’s get it off the table. $20 billion is less than 1% of their market cap and less than 20% of their annual free cash flow. For that, we can buy up a competitor and eliminate that potential margin pressure.”
On OpenAI compensation:
“No one ever said to Winston Churchill, ‘Congratulations, you won World War II on budget.’ They just said, ‘Congratulations, you won World War II.’ Sometimes the budget doesn’t matter. No one remembers the budget for World War II. Winning is the only thing.”
On founder vs. VC alignment:
“Trying to persuade a founder to hold on when they don’t want to is a very hard thing to do. And arguably you shouldn’t even try. In the end, 90% of the time the founder controls the exit decision and the 10% of the time they don’t, it’s usually a mistake for the VCs to try and control it.”
Harry Stebbings
On public market dysfunction:
“If companies that are worth $4 billion can’t go public with 27% growth and cash flows, then the public markets can quit bitching about how all the value is being created in the private markets.”
On the Manus deal math:
“If we’re on the Manus board, it’s doing 100 million now. Say it does 3x given the growth rates—that’s only 8x end of year revenues next year. It does feel quite cheap.”
On young founders judging talent:
“The scariest judge of young talent is young talent. The founder at 25—they’re marked to market on their team and on other people they know. That’s the generation they grew up with. They’re finding these new companies now and they’re going to hire the best and they’re going to discard the rest.”
The 20VC x SaaStr collaboration continues. Subscribe to both podcasts and never miss an episode.
