Family Offices Cut March Deal Count by 25% as AI Infrastructure Bets Grow Larger

Family offices took a step back in March, making 25% fewer direct investments compared to February, as reported by Fintrx and highlighted by CNBC. In total, there were 39 deals.

Interestingly, a quarter of those deals surpassed the $ 100 million mark. For instance, Jeff Bezos' family office co-led a whopping $ 1.03 billion seed round for AMI Labs, which focuses on training AI using sensory data instead of just text. Meanwhile, Azim Premji’s Premji Invest spearheaded a $ 450 million Series A for Rhoda AI, which is all about training industrial robots with video.

This trend isn’t just limited to family offices. The global M&A volume saw a 26% year-over-year increase, reaching $ 1.2 trillion last quarter, but the number of deals actually dropped by 17%, according to LSEG. The second week of March marked the lowest weekly M&A total in over a year, falling below $ 33 billion.

So, while capital isn’t vanishing, it’s definitely becoming more concentrated. Fewer investors are writing checks, but those that do are making larger commitments, especially in the realm of AI infrastructure.

For those sitting on the sidelines, the cost isn’t just about missing out on returns from any single deal. It’s about losing the opportunity to be part of the next big platform company when it decides on its cap table.

When deal flow slows down but deal sizes grow, who really stands to gain from the illiquidity premium?