Wise's Planned Move to US Listing Draws Ire From Co-Founder

Citi has appointed Heath Terry to lead AI industry coverage and research into private firms, a strategic move reflecting the significant market shift towards private companies, particularly in AI and aerospace, which has increased market opacity and shifted focus to venture capital and private equity. This trend is evidenced by nearly 1,500 global unicorn startups and record AI M&A activity, with deal value surging 288% to $49.9 billion in 2024. Furthermore, VC funding into US AI startups, at $104.3 billion in H1 2025, significantly outpaces exits, underscoring the growing capital flow and strategic importance of the private AI sector.

Analysis

Citigroup's strategic hire of Heath Terry to lead AI and private market research underscores a fundamental structural shift in capital markets. The increasing dominance of privately-held companies, particularly in high-growth sectors like AI and aerospace, has rendered financial data more opaque and elevated the importance of venture capital and private equity analysis. This trend is quantified by the existence of nearly 1,500 private startups valued at over $1 billion globally. The AI sector, specifically, is experiencing a surge in M&A activity, with global deal value jumping 288% to $49.9 billion in 2024, and deal volume rising 53%. This consolidation reflects a natural market progression where larger incumbents acquire innovative technologies rather than developing them in-house. Furthermore, a significant capital imbalance exists within the venture ecosystem; US AI startups raised $104.3 billion in the first half of 2025, while VC-backed exits totaled only $36 billion. This disparity highlights a massive influx of capital that has yet to generate returns, indicating a substantial pipeline of mature, private companies that will likely seek exits through future M&A or IPOs.

Key Decisions for Investors

• Investors should assess exposure to the burgeoning private AI market, as significant value is being created outside of public exchanges and may require specialized investment vehicles or positions in public companies with strong private portfolios.
• The accelerating M&A trend, with global AI deal value up 288% in 2024, signals a key strategy for value creation; monitor large-cap incumbents for acquisition activity and smaller, specialized AI firms as potential targets.
• The significant disparity between capital raised by US AI startups ($104.3B in H1 2025) and realized exits ($36B) points to a large pipeline of maturing companies, creating future M&A or IPO opportunities but also posing a potential valuation risk if the exit market becomes saturated.