20VC: Groq's $20BN NVIDIA Acquisition | Manus Acquired by Meta for $2BN | Why Sam Altman Does Not Care About Dilution | Navan Trading at 4x ARR & Why Going Public Does Not Make Sense Anymore | The Rise of Invisible Unemployment and Labour Markets in 2026
Timestamps are as accurate as they can be but may be slightly off. We encourage you to listen to the full context.
Podcast Summary
In this jam-packed episode, the hosts dissect two massive AI acquisitions that dominated the headlines: (04:30) NVIDIA's $20 billion purchase of Groq and Meta's $2.5 billion acquisition of Manus. They explore what these deals signal about the AI infrastructure wars and whether founders are selling at local maximums. (35:56) The discussion then shifts to OpenAI's unprecedented compensation strategy, spending 46% of revenue on stock-based compensation, and what this means for talent retention in AI companies. (56:13) The hosts also analyze Navan's struggles as a public company trading at 4x ARR and debate whether the IPO window is truly open for non-AI companies.
- Main Theme: AI acquisitions are reshaping competitive dynamics, while unprecedented compensation packages and challenging public markets reveal the new realities of tech company valuations and exits
Speakers
Harry Stebbings
Host of 20VC podcast and Managing Partner of 20VC fund, one of the most prominent voices in venture capital. Known for his incisive interviews with top founders and investors, Stebbings has built a media empire around startup insights and has invested in numerous successful companies.
Jason Lemkin
Founder and Managing Director at SaaStr, having previously founded EchoSign which was acquired by Adobe for $100+ million. He's a prolific SaaS investor and thought leader who has helped build the SaaS community through conferences and content.
Rory O'Driscoll
Managing Director at Scale Venture Partners with extensive experience in growth-stage investing. He has a strong background in both operating and investing, having worked at companies like Adobe before transitioning to venture capital.
Key Takeaways
Strategic Acquisitions Trump Financial Metrics in AI
NVIDIA's $20B Groq acquisition demonstrates that strategic value often supersedes traditional valuation methods in AI. (06:45) Despite Groq having only ~$175M in revenue, NVIDIA paid 3x the last round price to eliminate a potential competitor and secure inference capabilities. As Rory noted, this was less than 1% of NVIDIA's market cap but could protect their massive GPU empire. The lesson: when you have an existential asset that threatens a much larger market, traditional multiples become irrelevant. Companies should recognize when they hold strategic leverage that extends far beyond their standalone value.
Founders Should Recognize Local Maximums
The Manus acquisition at $2.5B for $100M ARR (25x multiple) illustrates the concept of "local maximum" exits. (21:23) Despite having term sheets for new funding at the same price, the founders chose to sell, recognizing the risks of being an orchestration layer competing with Anthropic and OpenAI. Jason emphasized that with 80% ownership and potential regulatory risks, taking half a billion dollars each was rational risk management. Smart founders evaluate not just growth potential, but competitive threats, market timing, and personal financial security when considering exits.
Exceptional Talent Commands Exceptional Compensation
OpenAI's decision to spend 46% of revenue ($1.5M per employee) on stock compensation reveals the new reality of AI talent wars. (37:10) Even with this unprecedented compensation, OpenAI only retains 60% of researchers in their first year. Rory explained that for companies where talent is truly the only differentiator, traditional compensation benchmarks become irrelevant. The takeaway: when competing for scarce, game-changing talent, you must be willing to pay what the market demands, not what feels comfortable based on historical standards.
Public Markets Aren't Compelling for Strong Companies
Navan's struggle at 4x ARR despite being profitable highlights a broader issue with public market appeal. (56:13) The hosts discussed how companies like Stripe and Databricks generate billions in free cash flow and can dividend out hundreds of millions annually to founders while remaining private. This creates a fundamental question: why go public if private markets offer better valuations and fewer constraints? Companies should seriously evaluate whether public markets actually provide better access to capital or just more headaches.
Prepare for Invisible Unemployment
The emergence of "invisible unemployment" - where companies achieve higher growth with flat headcount through AI - will reshape the job market. (70:49) Jason highlighted that entry-level positions like SDRs are disappearing, while only top-tier AI talent finds infinite opportunities. Companies like Shopify hit massive growth for three consecutive years without adding headcount. Workers need to either become indispensable through unique AI skills or accept that many traditional roles are becoming obsolete. The key is honest self-assessment and aggressive reskilling rather than hoping the trend reverses.
Statistics & Facts
- OpenAI spends 46% of its revenue on stock-based compensation, amounting to $1.5 million per employee - (37:10) 34 times higher than comparable pre-IPO tech companies, yet still only retains 60% of researchers in their first year.
- Groq generated only $4 million in revenue in 2023 and approximately $50 million in 2024, making the $20 billion acquisition price roughly 400x their current revenue run rate. (08:00)
- Manus was acquired for $2.5 billion at $100 million ARR (25x multiple) with founders owning 80% of the company, having taken only 20% VC dilution throughout their funding history. (21:23)
