Private equity is now in bed with the same AI giants that are decimating the industry's portfolio values, particularly the hundreds of billions invested in software.

Driving the news: Both Anthropic and OpenAI have completed their deals to form AI consulting firms that are funded by, and will initially be used by, large private equity firms.

• Anthropic announced its joint venture yesterday, while OpenAI's announcement is expected later this month.

Zoom in: The two new entities are structured quite differently, according to multiple sources:

• Anthropic: Its entity is seeded with $1.5 billion, which also serves as the new entity's de facto valuation. Anthropic is a minority shareholder, on par with lead investors like Blackstone and Hellman & Friedman.
• Other backers include Goldman Sachs, General Atlantic, Leonard Green, Apollo, GIC, and Sequoia Capital.
• OpenAI: Its entity is seeded with $4 billion at a $10 billion pre-money valuation. Backers are allowed to exit after five years with a 17.5% gain guaranteed by OpenAI, but their upside is capped at a level I've not yet learned.
• Its investor roster includes around 20 firms. This includes Bain Capital and TPG, but not all of them are traditional private equity. OpenAI is investing around $500 million.
• It also may acquire forward-deployed engineering teams.

Behind the scenes: Shareholders in each entity are said to be precluded from investing in the other, although it sounds like Goldman Sachs may be in both.

• Apparently that's the benefit of being a bank both Anthropic and OpenAI want to help manage their IPO.

The bottom line: Private equity views these deals as both offensive and defensive.

• Offensive because they may be building AI-native versions of McKinsey & Co., which could produce giant investment returns.
• Defensive because PE firms know what they don't know, and bringing AI expertise in-house — or close enough — could be a needed knowledge boon for existing and future portfolio companies.

Bullish (NYSE: BLSH), a crypto exchange led by former NYSE president Tom Farley, agreed to acquire transfer agent Equiniti from private equity firm Siris for $4.25 billion in stock.

Why it's the BFD: This would further blur the lines — or perhaps bridge the gap — between crypto and traditional capital markets.

Catch up quick: Siris took U.K.-based Equiniti private in 2021 for roughly $950 million, and later merged it with American Stock Transfer.

Elsewhere in crypto: Andreessen Horowitz raised $2.2 billion for its fifth crypto venture fund. Haun Ventures, led by a former co-head of a16z crypto, raised $1 billion for a pair of new funds.

The bottom line: "Crypto exchanges are pushing into tokenized equities, and this lets Bullish own the full stack for registering and trading those assets 24/7. It also provides steadier, more durable revenue to pair against more volatile crypto trading." — Ryan Lawler, Axios Pro

• Sierra, a provider of custom AI agents for enterprise customer service, raised $950m at a $15.8b post-money valuation. Tiger Global and GV led, joined by Benchmark, Sequoia, and Greenoaks. axios.link/4es8HAb

🚑 Windward Bio, a Swiss immune biotech, raised $165m. OrbiMed led, joined by Novo Holdings, Blue Owl, SR One, Omega Funds, RTW Investments, Qiming Venture Partners, Quan Capital, Pivotal bioVenture Partners, RA Capital Management, Janus Henderson Investors, Sanofi Ventures, and Harbour BioMed. axios.link/499Hgre

⚡️ Panthalassa, a Portland, Ore.-based developer of tidal-powered data centers, raised $140m in Series B funding at a $1b valuation. Peter Thiel led, joined by TIME Ventures, SciFi Ventures, Susquehanna Sustainable Investments, Hanwha Group, Fortescue Ventures, Future Positive, WTI, Nimble Partners, Super Micro Computer, Sozo Ventures, Planetary VC, Leblon Capital, Resilience Reserve, Portland Seed Fund, and the Intrepid Oregon Fund. axios.link/3P2VrHG

• Reserv, a NYC-based property and casualty insuretech, raised $125m in Series C funding. KKR led, joined by Bain Capital Ventures and Flourish Ventures. axios.link/49eUva5

• RadixArk, a startup seeking to make makes AI inference and training more efficient, raised $100m in seed funding at a $400m post-money valuation. Accel and Spark Capital led, joined by NVentures, Salience Capital, A&E Investments, HOF Capital, Walden Catalyst Ventures, AMD, LDV Partners, WTT Investment, and MediaTek. axios.link/3R6sN9j

• eleQtron, a German trapped ion quantum computing startup, raised €57m in Series A funding. Schwarz Digits led, joined by the European Innovation Council Fund, Earlybird, Ankaa Ventures, Precitec, NRW BANK, and IFB Hamburg. axios.link/4d3HMbh

• Astrocade, a games creation platform, raised $56m in Series A and Series B funding from Sea, Sequoia Capital, Google, Nvidia, LG Ventures, Dentsu Ventures, and Conviction Embed. axios.link/4f27Vdg

🚑 Latus Bio, a Philly and Boston-based gene therapy startup, raised $42m in Series A extension funding. 8VC led, joined by DCVC Bio, BioAdvance, Benjamin Franklin Technology Partners, Modi Ventures, Gaingels, Hatch BioFund, Korea Development Bank, and Helen's Pink Sky Foundation. axios.link/4tTO5pi

⚡️ Moment Energy, an EV battery repurposing company, raised $40m in Series B funding. Evok Innovations led, joined by Amazon's Climate Pledge Fund and In-Q-Tel. axios.link/48BNm3y

🌎 Magrathea, an SF-based extractor of magnesium metal from waste brines and seawater, raised $24m in Series A funding per Axios Pro. Resource Technology Capital and Balerion Space Ventures led, joined by Oxcart, WovenEarth, Audacity, Avila and insiders VoLo Earth, Capricorn Investment Group and Ora Global. axios.link/4tb2rQR

• Nace.AI, a Palo Alto-based startup that helps businesses build specialized AI models, raised $21.5m in seed funding, per Axios Pro. Walden Catalyst led, joined by General Catalyst. axios.link/4n7b2Tc

🚑 Pumpkinseed, a Palo Alto-based protein sequencing startup, raised $20m in Series A funding, per Axios Pro. NFX and Future Ventures led, joined by Base4, ADVentures, and Stanford University. axios.link/3QG6vLD

• Degen, a developer of modular creative tools, raised $15m in seed funding led by GV. degen.online

🚑 Noho Labs, a personalized peptides startup founded by Matt Mazzeo (ex-Coatue), raised $16m in pre-seed and seed funding led by 8VC, Verified Capital and Elad Gil, per Axios Pro. axios.link/49npTDh

• PlayReplay, an electronic tennis line-calling startup, raised $12m. Alfven & Didrikson led, joined by Centre Court Capital and ExM Investment Partners. axios.link/4cOOQdc

🚑 Village, an LA-based provider of pediatric practice management software, raised $9.5m in seed funding, per Axios Pro. Upfront Ventures led, joined by Bling Capital, GTMFund and Perceptive Ventures. axios.link/3OGjtIE

• Moritz, a legal tech startup, raised $9m from 20VC, Urban Innovation Fund, and Inception. axios.link/4tT8k6D

🌎 Barocal, a U.K. refrigerant-free cooling and heating tech developer, raised €8.5m in seed funding from World Fund, Breakthrough Energy Discovery, Cambridge Enterprise Ventures, and IP Group. axios.link/48G5kSv

• LakeFusion, an Austin, Texas-based data management platform, raised $7.5m in seed funding. Silverton Partners led, joined by Carbide Ventures. axios.link/4dla56x

• Spring Labs, a Marina del Rey, Calif.-based fintech compliance startup, raised $5m in seed funding from BankTech Ventures and Haymaker Ventures, per Axios Pro. axios.link/4d6wS4U

• Astrada, an SF-based data layer for autonomous finance, raised $3.8m in seed funding from Bain Capital Ventures, QED Investors, Nyca Partners, Mastercard, and Visa. axios.link/3PjIjOE

🌎 Reduciner, a Finnish carbon conversion startup, raised €3.6m from Voima Ventures, Lifeline Ventures, and the Mikko Kodisoja Foundation. axios.link/4wbA6g4

• Elastics, a Polish developer of agents for prediction markets, raised $2m in pre-seed funding led by Frst. axios.link/4tMD5df

🚑 Arete Health, a portfolio company of MBF Healthcare Partners, acquired Virginia Rehabilitation & Wellness and S.C.-based Summerville Physical Therapy & Balance for Adults. axios.link/4tUrSrd

⚡️ Bregal Milestone acquired Meteoviva, a German provider of building energy management solutions. axios.link/42SlAfy

• CapMan agreed to acquire a majority stake in HeliAir Sweden, a Nordic helicopter operator and lessor that provides specialized services like firefighting. axios.link/3R2akL2

• COEO Solutions, a Riata Capital Group portfolio company, acquired S-Net Communications, a Schaumburg, Ill.-based cloud security company. axios.link/49ceJBi

• EQT raised its buyout offer for Intertek (LSE: ITRK), a British product testing ​and certifications group that's rejected prior bids, to £8.93b. axios.link/4d32Vm3

• Liberty Waste Solutions, an Allied Industrial Partners portfolio company, acquired Randolph County Garbage Services, an Asheboro, N.C.-based residential subscription waste collector. axios.link/4cRHRjM

• Long Path completed its £340m take-private buyout of Idox (LSE: IDOX), a British provider of government planning, compliance, and elections software. axios.link/431K5Yx

• Promera, an Angeles Equity Partners portfolio company, acquired Data Clean Asia, a Singaporean technical data center services provider. axios.link/4urLpz1

• Redwood Services, an Altas Partners portfolio company, acquired Sierra Platform, a Las Vegas-based HVAC and plumbing provider, from SE Capital. axios.link/4d5NgT5

• Traffic & Mobility Consultants, backed by Grovecourt Capital Partners, acquired Chindalur Traffic Solutions, a Jacksonville, Fla-based firm serving public agencies and private developers. axios.link/3PlO3aA

• Keystone Acquisition, a SPAC led by Richard Chin (co-CEO of Solidigm), filed for a $250m IPO. axios.link/4d02jxC

• Henko Partners is weighing a sale of its minority stake in Quadrante, a Portuguese engineering and environmental consultancy that could be valued north of €300m, per Bloomberg. axios.link/4ntr2iR

• MBK Partners is seeking to sell its stake in Belgian luxury chocolate brand Pierre Marcolini, which could fetch more than $100m, per Bloomberg. axios.link/4w51KLz

• Spectrum Safety Solutions, a Sentinel Capital Partners portfolio company, agreed to sell its Autronica Fire and Security unit to MSA Safety (NYSE: MSA) for $555m. axios.link/4d5TVg3

⚡️ Aspen Power has acquired two New Jersey-based solar projects from real estate developer Avidan Group. axios.link/4dobCbU

• IREN (Nasdaq: IREN) agreed to acquire Mirantis, a provider of cloud infrastructure and Kubernetes-based orchestration services, for $625m in stock. axios.link/4waY7nm

• Regis Resources (ASX: RRL) agreed to acquire rival Australian gold miner Vault Minerals (ASX: VAU). axios.link/49s691k

🚑 SGS (SGSN.SW acquired Keystone Bioanalytical, a North Wales, Pa.-based bioanalytical testing services provider. axios.link/4w9vmHP

• SOL Strategies (Nasdaq: STKE) agreed to acquire HoudiniSwap, a cross-chain swap aggregator, for $18m. axios.link/4tM2tQg

• Vodafone (LSE: VOD) agreed to take full control of its U.K. mobile joint venture with CK Hutchinson (HK: 0001), paying £4.3b for Hutchinson's 49% stake. axios.link/4uo2JVr

• AlphaDrive, an Israeli VC firm led by two Elron Ventures vets, raised $100m for its debut fund. axios.link/4f1FjAQ

• Audax Private Debt raised $1b for a direct lending CV led by Pantheon. axios.link/4nbdXdM

• Bridge Growth Partners raised $790m for a single-asset CV for infrastructure software firm Solace. axios.link/4tTbuY3

• Deviation Capital spun out from Two Sigma Ventures as an early-stage VC group with an initial $2b in fund assets. axios.link/3QSRFRS

• MidOcean Partners raised a $300m single-asset CV for Cloyes Gear and Products, a maker of auto timing drive systems and parts, led by Hamilton Lane. axios.link/4d00UqQ

• THL Partners of Boston raised $6.35b for its tenth flagship buyout fund. axios.link/3R67JzL

🚑 Arboretum Ventures promoted Jeff Terrell to managing partner. axios.link/4na96Jy

• James Dyett stepped down as OpenAI's head of sales to join Thrive Capital as an operator-in-residence. axios.link/4tY8DNw

• Sybel Fetta joined Eivor Capital as a principal. She previously was with Women's World Banking. axios.link/48IDFAi

• Aisha Lavinier joined Paul Weiss as a partner in its M&A Group. She previously was with Kirkland & Ellis. axios.link/48Bu7ak

🚑 Amardeep Kahlon joined RoundTable Healthcare Partners as an operating partner. He previously was CEO of Designs for Health. axios.link/42NiF7X

• Benjamin Passafuime joined Battery Ventures as a talent partner. He previously was with Alpine Investors. axios.link/42MTF0z

🌎 Leila Pirbay was promoted to partner at Overture Ventures. axios.link/4tc014n

• Mark Zerdin joined Paul Hastings as a London-based partner focused on sports and M&A. He previously was with Slaughter and May. axios.link/4d6vTBK

America's national debt is now larger than its GDP.

• Axios' Neil Irwin writes that we should pay more attention to the trajectory — i.e., how we got here and what comes next — than to the ratio. Go deeper.