Good morning.

An AI coding company that raised at $26 billion in May is already back in the market at $40 billion, and the interesting part is that its multiple went down. Josh Kushner raised $2 billion to buy accounting firms. And a four-person startup that hit $10 million in revenue is now worth $550 million for selling the thing that checks whether AI-written code actually works.

Let's get into it.

That is roughly the revenue multiple Cognition would be raising at, if the reported numbers hold. Bloomberg reported Wednesday that the maker of the Devin coding agent is already talking to investors about a new round at a valuation of at least $40 billion, three months after raising $1 billion at $26 billion in May.

Now do the arithmetic, because it runs the opposite way to the story everyone tells about this market. In May, Scott Wu confirmed a $492 million annualized run rate. That is a $26 billion valuation on $492 million, or about 53 times revenue. The new round is reportedly premised on reaching $1 billion annualized. Forty billion on a billion is 40 times. The valuation went up 54 percent. The revenue doubled. The multiple compressed by a quarter.

That is worth sitting with if you are raising anything this year. The headline number is louder, and the price of a dollar of revenue is quietly cheaper than it was in the spring. Investors are still writing enormous checks, but they are asking those checks to be attached to something. Wu also said in May that enterprise usage of Devin had grown 50 percent month over month for six straight months, which is the actual thing being bought here. Not the category, not the narrative, the compounding.

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Thrive Holdings ($2B, at $12B). SoftBank, D1 Capital, and Altimeter backed Josh Kushner's spinout from Thrive Capital, the first time outside investors have put money in, bringing total capital past $3 billion. The model is a private equity firm for AI: buy accounting and IT companies outright, then install your own engineers to rewire them. Current, its accounting arm, spans more than 50 firms and 2,000 professionals. Shield, the IT arm, has about 20 companies. The new money funds a third vertical aimed at permits, inspections, and compliance for data centers, power, water, and transport. Note what that means. Thrive looked at the AI buildout, decided the bottleneck is regulatory paperwork, and is buying the firms that do the paperwork.

CodeRabbit ($143M, Series C). Atomico and Smash Capital co-led at a $1.5 billion valuation, less than a year after the $60M Series B, with BMW i Ventures, Datadog, and Nvidia in. The San Francisco company runs AI-powered code review across 17,000+ customers including Nvidia, BMW, and Adyen, doing more than 2 million reviews a week. Reading between the lines: revenue grew more than 5x year-over-year and the round funds a bet that "AI review of AI code" becomes a permanent enterprise line item, not a passing feature of GitHub.

Skan AI ($63M, Series B). Cathay Innovation and Dell Technologies Capital co-led, with Citi Ventures, Bloomberg Beta, State Farm Ventures, and Wipro Ventures, bringing the Menlo Park company to about $80 million total. Skan watches how work actually moves through an enterprise, which is the unglamorous prerequisite nobody wants to pay for and everybody needs. You cannot automate a process you have never accurately described.

Blacksmith ($45M, Series B). Peak XV led at a $550 million valuation, with Y Combinator and GV both returning, for a San Francisco company running continuous integration on purpose-built hardware. The numbers are the story. Customers went from roughly 800 to more than 6,000, including Supabase, Clerk, Ashby, and Mercury. Weekly CI jobs have grown 5 to 10 percent week over week all year. The company hit a $10 million run rate with about ten people. AI made writing code cheap, which made checking code the bottleneck, and Blacksmith sells the checking.

Mindgard (amount undisclosed). The smallest name on the board and worth watching anyway. Mindgard does AI security testing, a category that barely existed eighteen months ago and now has three separate labs disclosing that their models broke into real companies during evaluations. Somebody has to red-team the things before they ship.

→ Blacksmith closed its round in March and announced it in August. Five months of silence between signing and saying so, disclosed in the company's own post. This is becoming ordinary and almost nobody outside the process notices. Funding announcements are now scheduled communications rather than news, timed to hiring pushes, competitive positioning, or a quarter when the growth chart looks best. If you are a founder reading a competitor's raise and feeling behind, remember you may be reading about something that happened two quarters ago. And if you are reading the market's temperature off announcement volume, you are reading a lagging indicator with a marketing department attached.

→ More than 500 US towns now restrict or ban data centers. The figure surfaced in Thrive Holdings' pitch for its new regulatory vertical, and it is the cleanest number yet on a story this newsletter has tracked since New York's statewide moratorium in July. Thrive's read is that permitting has become a business worth buying into. That is an unusual thing to believe, and it is also the correct conclusion if you think the constraint on AI has stopped being chips and started being consent.

→ Lightspeed is raising a $600 million secondary vehicle called Project Mercury to extend its position in OpenAI and add a fresh Anthropic stake, per Bloomberg. The structure lets Lightspeed hold winners past a fund's normal life while returning cash to Select V and Opportunity II LPs. When a top-tier firm builds a whole new vehicle just to keep owning two names, the signal is that OpenAI and Anthropic equity has quietly become the venture-portfolio equivalent of holding Apple.

→ A $1.85 billion Coweta County data-center project just landed on the county planning commission's agenda in Georgia, one of dozens moving through local approvals this quarter. The developer is Corscale, capacity is 240 MW, and the site is 1,400 acres. Every state economic-development office in the Southeast now has a data-center pitch deck. The permitting friction is where the next round of AI capex slows or accelerates.

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The Vesting Team (Brycent, Ajay, and Kamil)