No pitch, no problem. VC is changing. 👀
Sep 25, 2025
Kaley Ubellacker
Happy Wednesday!
Happy Wednesday! If you’re new here, welcome to Necessary Nuggets, your one-stop pre-seed shop. We deliver updates from Necessary Ventures and helpful tidbits on our little corner of the world. Every edition is also on our blog.
What's happening at Necessary Ventures:
Portfolio company Nevoya won GMA Trucking's Pilot RFP on its mission to make zero-emission freight transport possible.
Good Reads 📖
For the rushed reader …
Early-stage founders are no longer defaulting to venture capital as their primary funding source, according to a recent Mercury survey of 1,500 U.S. entrepreneurs.
Tim Chen, the engineer-turned-solo-VC behind Essence VC, just closed his fourth fund at $41 million, without even pitching.
Foundation Capital is taking an unusually bold approach to venture investing by targeting what they’re calling “zero billion-dollar markets,” i.e., sectors that don’t exist yet.
For the less rushed reader …
Know your self-funding worth
Founders are venturing away from venture. Early-stage founders are no longer defaulting to venture capital as their primary funding source, according to a recent Mercury survey of 1,500 U.S. entrepreneurs. More than half of tech startups surveyed have never raised venture capital, instead relying on self-funding, loans, revenue financing, and personal networks. The shift is driven in part by the fact that nearly two-thirds of VC dollars this year have gone to AI companies. With two-thirds of founders reporting they’ve adjusted their capital strategies in the past year, the trend points to a more resilient, multichannel approach to funding, blending equity with debt and alternative sources. They say it takes a village, and raising capital is no exception.
Ditch the pitch
One investor is making everything look VC-peasy. Tim Chen, the engineer-turned-solo-VC behind Essence VC, just closed his fourth fund at $41 million, without even pitching. LPs rushed in after one of his portfolio bets, Tabular, sold to Databricks for $2.2 billion, effectively returning his entire second fund. Chen’s journey is a reminder of how nontraditional profiles can break through in venture. He bootstrapped his way into VC via AngelList and a $1M debut fund, steadily compounding credibility with a focus on developer tools and infrastructure. His technical expertise, honed as an early Mesosphere engineer and AIOps founder, sets him apart in early-stage investing. Backers in Fund IV include Tomasz Tunguz and Ethan Kurzweil, signalling the level of hype. As it turns out, exit strategies can be the perfect entry ticket.
Zero to hero
Ground zero looks a bit more glamorous. Foundation Capital is taking an unusually bold approach to venture investing by targeting what they’re calling “zero billion-dollar markets,” i.e., sectors that don’t exist yet. With a new $600 million fund, the firm will back technical founders at the earliest stages, often pre-product and even pre-revenue. Foundation is known for incubating AI chipmaker Cerebras in 2016 and investing in over 100 AI startups across infrastructure, tools, and applications. What sets the firm apart is its willingness to invest before consensus forms and helping startups scale through the risky first million dollars in revenue. Their strategy takes on a high-risk, high-reward model, identifying transformative markets through technical insight, careful observation of open-source contributions, and conviction-driven early-stage bets. Foundation is literally investing in the foundation of new industries.
Market Stirrings 🚩
Here's what the week looked like in pre-seed:
$5.6M
11
Data aggregated from proprietary research and Crunchbase; valuation estimate based on 10-20% ownership stake.
Early-stage startups are being acquired at a significantly higher frequency than in previous years, up nearly 20% from the peak in 2022. This trend reflects increased interest from larger companies seeking to secure talent, technology, and market share early, as well as investors looking for quicker exits in a volatile funding environment.
Fire Up the Pre-Seeds🔥
Highlights from this week’s pre-seed raises:
healthtech
VerQ - No more claiming up.
VerQ raised $750k at a $4.8 million pre-money valuation. VerQ is building a healthcare claims processing platform that uses blockchain and smart contracts to automate workflows and cut costs.
healthtech
Provision Surgical - Joint effort.
Provision Surgical raised funding at a $7.5 million pre-money valuation. Provision Surgical is developing an augmented reality navigation system for orthopedic surgery that provides real-time, intraoperative guidance.
AI
Ethosphere - Walk the talk.
Ethosphere raised $2.5 million led by Point 72 Ventures. Ethosphere is building a voice AI platform that transforms in-store retail interactions into actionable coaching insights for driving sales.
JOBORTUNITIES
| Hardware Test Engineer | - Copper:
Rethinking the induction stove and making kitchen electrification more accessible than ever. Picture a fossil-free future, without sacrificing aesthetics.| Full Stack Software Engineer | - OneImaging:
Envisioning the future of transportation beyond cars and into the realm of personal electric vehicles. Its first product, P1, is the ultimate tool for city navigation
Outro🚪
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Thanks for reading, and see you next week!
