Venture capital is buying its way into the AI transformation that enterprise software hasn’t delivered. Instead of selling AI tools to companies, venture firms are buying legacy companies outright and rebuilding them around AI from the inside. The bet puts VCs on offense and leaves traditional private equity, which spent the last cycle buying enterprise software at peak prices, on defense.
The strategy is known in Silicon Valley as the AI rollup. Over the past six months it has crossed into public markets twice: General Catalyst and Trian’s $7.6 billion take-private of Janus Henderson (JHG) in December, and Long Lake Management’s $6.3 billion agreement in May to take American Express Global Business Travel (GBTG) private at a 65 percent premium. CNBC’s Deirdre Bosa has the story.

Chapters:
0:00 – 0:55 Introduction
0:56 – 4:31 The AI rollup
4:32 – 5:34 Where private equity got it wrong
5:35 – 7:20 A risky bet

Anchor and Columnist: Deirdre Bosa
Produced by: Jasmine Wu
Edited by: Andrew Evers
Senior Director of Video: Jeniece Pettitt
Animation: Emily Park

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AI Rollup: Silicon Valley’s New Buyout Playbook Is Hitting Wall Street

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For two years, companies bought AI one way: pick the most powerful model and run everything through it. That era is ending.

A new discipline called model routing is taking hold, sending hard tasks to expensive frontier models and easy ones to cheaper, faster alternatives. It can cut AI bills dramatically. But it also means OpenAI and Anthropic stop getting paid for every task, which complicates the IPO story both are built on.

Deirdre Bosa talks to Scott Wu, co-founder and CEO of Cognition (maker of the coding agent Devin), about his new engineering value guarantee, why Devin routes across models automatically, and what it actually takes to measure AI’s return. Then Cisco President and Chief Product Officer Jeetu Patel on the cost shock hitting the enterprise, why his own company blew through its AI budget, and whether the frontier labs can hold their pricing power.

Anchor and columnist: Deirdre Bosa
Produced by: Jasmine Wu
Editing by: Erin Black
Technical Associate: Sami Savona
Senior Director of Video: Jeniece Pettitt

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Why The Fix For AI’s Spending Problem Is Not Good For OpenAI And Anthropic
Why The Fix For AI’s Spending Problem Is Not Good For OpenAI And Anthropic

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Intel issued a safety recall for its Basis-brand fitness watch, warning that the device could cause blisters or burns.
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Intel Recalls Its Smartwatch | CNBC

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The rapid spread of AI across corporate America is creating a crisis for young adults with college degrees who are finding a slowdown in hiring for entry-level positions in AI-exposed industries.

Find the full report in related video.

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CNBC’s Deirdre Bosa reports on Alibaba’s entry into the smart-speaker market with the Genie device, which the tech giant announced Wednesday. For now, the device only speaks Mandarin.
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Alibaba Unveils Smart Speaker To Rival Amazon Echo And Google Home | CNBC

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