Simon Wu

Partner @Cathayinnov, $2.5B global venture capital firm, focused on Series A/B across consumer and enterprise

[Simon Wu @sim0nwu]

It was just 2016 when I joined with Mingpo, @denisbarrier, and the rest of @Cathayinnov to help start our next gen VC. Today, 6yrs into the journey, we partnered w/ 120+ early stage cos, w/ ~1 in 6 now a unicorn. With now $2B+ AUM, we start the next chapter, €1B Fund III 🚀

[Cathay Innovation @Cathayinnov]

Celebrating a huge milestone today with the launch of Fund III — a €1B global #VentureCapital fund for the #transformation of industries & society.

Cathay’s @denisbarrier digs in to the vision, evolution & what we see as the next-gen VC playbook here: https://t.co/8SA3EFPT1z

[Simon Wu @sim0nwu]

https://t.co/C3aVhhIyuJ

[Simon Wu @sim0nwu]

https://t.co/AQx5wUWX6T

[Simon Wu @sim0nwu]

https://t.co/ns3tMcmPYd

[Simon Wu @sim0nwu]

https://t.co/SWLqUPg0u9

[Simon Wu @sim0nwu]

SpaceX had a choice.

Pay for Cursor's data as pure R&D and hope a model ships. Or rent Colossus to Cursor, get the data engine running, and buy a one-year right to acquire for $60B if the model wins — or walk away for $10B if it doesn't.

They chose option two.

The signal came a month before the announcement. Elon tweeted three words about Cursor's supposedly proprietary model: "Yeah, it's Kimi 2.5."

The base model was free. Available to anyone.

What Cursor built on top was two years of professional engineers correcting real code inside private systems. The asset no lab can buy, replicate, or brute-force regardless of how many engineers they hire.

Not the editor. The last mile.

Coding is where AI makes the most money today. SpaceX just bet $10B to find out if Cursor's data plus xAI's compute beats what OpenAI and Anthropic have approximated without it.

With SpaceX IPO math, $10B is a rounding error. A $60B acquisition might turn out to be the best capital allocation in tech this year.

I wrote about what this means for every vertical AI company - why no lead is safe, why open source is actually vertical AI's best friend not its threat, and what the defensible moat actually looks like in 2026.

[Simon Wu @sim0nwu]

https://t.co/GVqYqq7ekN

[Simon Wu @sim0nwu]

I'm an early stage tech investor. I don't trade stocks.

But public comps drive multiples, multiples drive exit assumptions, and exit assumptions shape what I underwrite today. So I watch closely.

What I'm seeing: the market has stopped rewarding AI narrative and started demanding proof. ServiceNow beat earnings and dropped 17%. The rally is real but narrow — fewer than 15 S&P 500 names at their own highs even as the index hits records the other day.

Capital is concentrating fast. The companies that can show real AI budget capture will have options. The ones that can't are waiting on a window that may not open evenly.

This isn't a paused market. It's a selective reset.

[Simon Wu @sim0nwu]

Subscribe here: https://t.co/bexSlmKNKY

[Simon Wu @sim0nwu]

I’ve been having the same set of conversations over and over again the past few months. So I finally decided to just write them down.

Introducing: Signals by Simon.

A place to park thoughts I keep repeating in 1:1s—on AI, company building, and what’s actually changing underneath the surface.

I’ve spent the last decade trying to be the most helpful investor on the cap table, regardless of check size. This is me thinking out loud.

The first series is a question I can’t seem to shake:
AI is labor.

So what does a software company actually look like in that world?

The model is starting to flip.

You don’t sell software. You own the outcome.

Some of the best companies are already hitting 50%+ gross margins doing this.

But there’s a trap here that I don’t think people fully appreciate yet.

Strong revenue + solid retention can look like product-market fit—when you’re actually just running a human-powered services business financed with the wrong kind of capital.

And if you miss that early, it breaks later.

What actually compounds here isn’t obvious.

The real question isn’t “software vs services.”

It’s whether execution scales non-linearly.

A few things I’ll be digging into:
→ Why customer two matters more than customer one
→ Why services aren’t the problem—linear scaling is
→ Where defensibility actually comes from in AI
→ Why execution beats features in an agent-driven world

Not predictions. Just loosely held opinions.

Full series below if you’re interested—curious what resonates.

[Simon Wu @sim0nwu]

First 4 part series: https://t.co/yuS3u7Jq23

[Simon Wu @sim0nwu]

@rsarver Love it Ryan - open source!

[Simon Wu @sim0nwu]

@loganbartlett @matt_slotnick @PaneerCap i'm starting to see larger private companies re-org themselves for the opportunity. The larger the company, the longer change mgmt. will take. Not everyone can be Apple and still pull it off at the end but wouldn't dismiss the whole incumbent group out just yet.

[Simon Wu @sim0nwu]

@Mattbrown Nice piece!

[Simon Wu @sim0nwu]

@Hadley @nihalmehta @nihalmehta ni-hall 9000

[Simon Wu @sim0nwu]

@jasonlk @yrechtman @pangram @max_spero_ Really hard to polish anything anymore without triggering this 😤

[Simon Wu @sim0nwu]

@pitdesi Mindshare for sure -> wonder if CB is used by more millennials and RH for Gen Z?

[Simon Wu @sim0nwu]

@saranormous 💯 you’re only as good as your last deal

[Alpha Partners @alphaptrs]

Hot take: by next year, no one will call themselves an “AI company.”

In this clip, @sim0nwu of @Cathayinnov breaks down why the term "AI company" is already becoming meaningless; and what that means for valuations, traction, and the looming Series B crunch.

📌Listen to the full episode here: https://t.co/Yz7NJilbTU

A special shoutout to our sponsor, @affinity__crm!

[Alpha Partners @alphaptrs]

The latest Driving Alpha drop: @sim0nwu from @Cathayinnov shares what truly builds trust between founders and VCs: it’s not just the pitch deck or the metrics, it’s early engagement and shared storytelling.

If you’re a founder with early traction, this is a playbook for landing strategic capital and your next customer.

📌 Full episode here:https://t.co/Yz7NJilbTU

A special shoutout to our sponsor, @affinity__crm

#startups #venturecapital #founders #scaling #DrivingAlpha

[Simon Wu @sim0nwu]

@atShruti Their best songs were at the end 😮‍💨