General Catalyst selling stakes as it expands beyond VC roots
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General Catalyst has reached out to several large organizations about buying a stake in its holding company, as it continues to expand beyond its venture capital roots, Axios has learned.
Why it matters: GC is one of the startup world's most active investors, with $32 billion in assets under management. Portfolio companies have included Airbnb, Anduril, and Stripe.
The big picture: The firm, founded 25 years ago in Harvard Square, has reorganized into three main business lines:
- Asset management, including $8 billion of new VC funds raised late last year.
- HATCo, a health-care transformation platform that recently bought an entire health system in Ohio.
- A new unit designed to help legacy organizations get smarter about AI and other tech modernization. Those organizations would be buyers of the new GP stakes, making them both strategic and financial partners.
Catch up quick: General Catalyst in 2018 sold a GP stake to Petershill Partners, which at the time was part of Goldman Sachs, for $200 million.
- Petershill earlier this month announced it was selling the position for $726 million, in part because of GC strategy changes, but didn't provide many more details.
Behind the scenes: Sources say that GC itself is the buyer, using some proceeds from the new stake sales. Other proceeds would be used to staff up the new tech transformation platform.
- The reason GC isn't having Petershill sell directly to the corporate partners is because the economic structure has changed since 2018.
A spokesperson for General Catalyst declined comment.
The bottom line: Big venture capital is mimicking big private equity, in seeking to become many more things to many more people.
