The AI Startup Venture Capitalists Are Secretly Funding

You can't directly invest in the market's hottest AI start-ups, including OpenAI and Anthropic, unless you're an accredited investor or a venture capitalist. However, you can still follow those companies, see how much funding they attract, and see if they're headed for an IPO.

One of those hot start-ups is Baseten, an AI infrastructure company that focuses on the inference layer -- the part of the AI stack that connects a trained AI model to user-facing applications. Its technology can help companies reduce inference costs by more than 40%.

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Basten's revenue soared from $2.7 million in 2023 to $15.8 million in 2025, and its valuation hit $5 billion after its latest $300 million funding round. Its top investors in that round included IVP, CapitalG, and Nvidia (NASDAQ: NVDA). That support from Nvidia, which contributed $150 million to that funding round, suggests it's a promising long-term play on the AI market's expansion.

Baseten's defensible niche and explosive growth rates will likely attract even more funding this year. It could also become a tempting takeover target for bigger tech companies. If it doesn't get acquired, it would definitely be a hot AI IPO -- but investors should be wary of its valuations.

Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.